Yes, the leaves should be dry or they pack, mat, and form anaerobic pockets. I use straw from time to time, but in a wet area and when not mixed with other materials it will also pack and mat. Chopped straw is supposed to be better about that, but I've never tried it.
You are correct, don't use cedar.
Go to a garden center and ask them for undyed mulch. Pine bark mulch is probably the easiest to find. I see it available in a number of brands on the Lowes website. Home Depot probably carries it too.