> 2) Does a "-j LOG" return to the chain it was called from, or does it do
> an implicit DROP?
>

It returns to spot where it was called from.

Yep, so you could create a new chain to drop and log;
/sbin/iptables -N logdrop
/sbin/iptables -A logdrop -j LOG --log-prefix 'DROP '
/sbin/iptables -A logdrop -j DROP

Then call that one
/sbin/iptables -A tcp_packets -p TCP --dport 80 -j ACCEPT
/sbin/iptables -A tcp_packets -p TCP -j logdrop