I am in a similar situation as you. Let me tell you what I understand so far of how it works. Let me know if my info is helpful to you or if you discovered things that contradict how I think it works!
I got a pile of cash in the safe. (say 1000$) then I have a little box on my office for people coming in wanting a little cash to get small stuff like a lightbulb.
Step 1) configure the cash journal
goto: configuration >> journals >> journals >> click on the cash journal
Then select the cash journal for the profit account, the loss account and the internal transfer account. This means if you put money in this cash register it will be taken from the cash account.
Question 1) I read in another post something about the checkbox opening with last closing balance but wasn't able to figure out how it works. (checking and unchecking didn't really change the behaviour)
Step 2) Create a cash register
goto: bank & cash >> cash registers >> click create
Now click open cashbox.
At this point the box is empty.
Lets assume you have 4 fifty dollar bills for the cash register.
Step 3) Put money in the box
Click on the more button in the center of the top toolbar, then select put money in
Put 200 and as reason something like initial deposit.
Step 4) do a petty cash transaction
Click edit then add item in the obi put lightbulb in the amount put -5 (don't forget the minus sign else it will add to the register).
Also put office expenses in the account.
OBI: I am not sure about the OBI but I think it seems to be just a reference to the transaction. Because when you put the reason for the initial deposit it puts it in the OBI space. However if you put numbers it will rank you transactions according to the OBI number which is odd. The OBI code stand for : "Originator to beneficiary information" (hover over and you will see).
Step 5) Take money out to close the cash register
At the end of the day you take what reamins fo the cash register out of your box and add it to the cash in your safe.
Click more, take money out, Reason end of day withdrawal, amount -195
Step 6) Close cash box
Click close cash box and you will see it will make the proposed journal items for you. one in particular being the office expenses being debited and cash being credited.