That would make sense that it's a 551, usually they're longer (referring to the 552/553/556) and the XPS is the only one I know thats super short like that and can fit a single CR123.
Lower means lower receiver, basically the part under the upper receiver but above the pistol grip, here's a picture of what I'm talking about
:
http://soldiersystems.net/blog1/wp-c.../bhi_lower.jpg
Should be able to do that if you want to go rear wired but it really depends. The bonus of rear wire is that there's no PEQ battery box in the front so you get more "real estate" on your rail system for other things like vert grips, flashlights, etc. I personally have my gun wired to the front but that's because I have no place to put my battery in the rear seeing as how I have the standard simple M4 4-position rear stock.