I am using custom fields. Whatever we define in "add new custom field" shows up in the dropdown on refreshing, but for some reason the thumbnail word doesn't add up in dropdown. Can I manually edit and add custom fields dropdown menus somewhere?
I just tested this by adding the customfield 'thumbnail' to my post and it showed up in the dropdown. I'm using WordPress 3.2 (Multisite). What version are you using? Have you tried it without any plugins with the default theme? Does it work?
As for your second question: WordPress has no global interface for editting customfields. You may check the plugin repository if there is a plugin available which allows you to do this.