gamd:
So my first question is what exactly "long cycles = (F_CPU * microseconds) / 2000000;" does do? Is it the timer cycle? But what is F_CPU e.g. and why dividing by 2000000?
It is a predefined constant that is set according to the speed of the processor you are using. For example, a Uno runs at 16MHz.
That code is just determining what the prescale values need to be in order to achieve the desired period. (The 2 is in there since the timer counts up and then down before an interrupt - look at the comment)