A:Answeryou need to use the audio adapter if you have an older version controller without the 3.5mm audio port. and unless you plug it into a usb power source the LED lights won't function,you could always use a usb power pack of some kind if you really wants the lights to turn on.
A:Answeryou have to use the PS4's menu to change the volume. Press the PS button, to get started, this popup menu has seen many iterations, but you should be abel to find the volumes, both input and output.