1: The quick way is to change their uniforms, either by assigning the other standard uniform (the metal one) to the squad (shift enter for all, I think), or by designing your custom uniform and then assigning it.
The slower way is to individually per member specify which pieces to wear.
Both these things are done from the 'm'ilitary menu.
If you just state 'metal' as the material, I think they will automatically switch. There is a drawback to that, however, due to how clothing replacement works. When your squad is at station, your smiths produce some nicer stuff. When you order the squad to move, their members check if there is new stuff available, allocate the shinier stuff, and immediately dumps their currently equipped corresponding item(s). When you release them from station, they will go and pick up the new stuff, but if there is a fight in between they may fight naked, without even woad as protection. Also, your "inferior" high quality steel armor piece is now dropped deep within hostile territory in favor of the masterworks steel armor piece.
2. You should probably get rid of it by releasing it when it is in human form:
Build the cage outside of your fortress (outside of your traps), build a lever (anywhere) and hook the cage to the lever. Wait for the were to transform and then transform back. Pull the lever. The human will flee the map, and will not come back (at least I've never seen any weres come back).
Otherwise, you can safely transfer the cage by 'b'uild 'j'cage at your desired dungeon location, or you can just have it sit in the stockpile.
I released the one I caught, because I suspect it spooked a caravan to turn away while inbound by turning FROM beast form into sentient form when they had arrived.