Sorry not to be able to offer specific experience, but what I can say is :-
How does it work?
Depends on which test you actually take. There are quite a few. Whichever one you do you will need to achieve level A1 which is very basic.
Do I have to attend in school? I guess this all depends on the level of English you have right now and your own self confidence. UKBA are only looking at your listening and speaking level, nothing else.
I would think it's a good idea to spend maybe 1 or 2 days doing a review and some pratice. Can only help you
Costwise it seems to be around P7000 - P8000 for the test alone.
Hope that will help initially, but I strongly suggest you do a search here as there is already a lot of detailed info.
Later, you can recall your experience here and help lots of others.
Good luck