Type of cedar: Not red cedar (like would be used in a closet). Basically, use the type of cedar you'll find at the lumber store. Select those boards with the tightest grain, and when gluing up, make sure the grain all runs in the same direction for the best stability.
Glue: I'd recommend "Titebond II" as it's commonly available and weatherproof. It won't withstand continued submersion but will most certainly handle the elements. I've used it to build paddles and it's held up without issue.
Finish: An exterior polyurethane varnish ("Spar varnish") will do. Linseed wouldn't give you the toughness you need.
Planer/Jointer: Not necessary but handy -- the table saw will give you good glue joints alone. What would be more important is the clamping strategy used when gluing up -- you can (almost) never have enough clamps! Go ahead and make a test glue joint with some scrap, let it dry, and try to break it apart to test its strength.
Also, "5/4" describes an unplaned board that would normally be planed to a final 1" thickness. Do NOT glue rough surfaces together.