Congratulations. You've discovered that there are differences between guitars and lutes. It will take some experimentation, and the whole process will go a lot faster if you invest in some lessons with someone who knows how to do it.
Holding a lute can present problems. A strap is a good idea. Some players use high-friction lap pads of some sort (leather and rubber are usual). There's no standard way of doing it. There's no hard and fast rule about nails. You'll probably find that long nails may make an unpleasant sound on the lute, which is already bright in tone, unlike the modern guitar. Some players shape their nails to one side so they can play modern guitar with nails and lute without. Yes, you can tune the lute like a guitar and play guitar music that doesn't go high on the fingerboard. But what's the point? Don't you already have a guitar? And didn't you buy the lute to play lute music? To get on or off this list see list information at http://www.cs.dartmouth.edu/~wbc/lute-admin/index.html
