Вечером я люблю посидеть на скамейке у озера.

Вечером is the instrumental case of вечер. With times of day, Russian often uses the instrumental to mean at/in (that time):

• утром = in the morning
• днём = in the daytime
• вечером = in the evening
• ночью = at night
  So вечером is basically (by) evening-time → in the evening.

Yes. The difference is mainly about frequency:

• вечером = (this/that) evening or in the evening in a general sense, but it often feels like a single evening or a typical time-of-day setting.
• по вечерам = in the evenings / evenings (habitually), clearly meaning repeatedly. So По вечерам я люблю… strongly implies a routine.

Both are possible, but they express different nuances:

• люблю сидеть (imperfective) = I like the activity in general / I like being seated (more open-ended).
• люблю посидеть (perfective) = I like to sit for a while, i.e., a completed “session” of sitting with a natural limit. The verb посидеть often means to sit for a bit / to spend some time sitting.

The preposition на can mean on (location) and then it usually takes the prepositional case:

• на скамейке = on the bench (location: where?) If you were talking about movement onto it, you’d use на + accusative:
• сесть на скамейку = to sit down onto the bench (direction: where to?)

Because на + location calls for the prepositional, and the ending -е is a common prepositional ending for feminine nouns like скамейка:

• nominative: скамейка
• prepositional: на скамейке You can also recognize it from the question где? (where?) → на скамейке.

У + genitive is a very common, neutral way to mean by/near/at (the side of) something:

• у озера = by the lake / near the lake
  It often implies being right near it.
  Alternatives are possible but can shift nuance:
• рядом с озером = next to the lake (explicit right beside)
• около озера = near the lake (often a bit more “in the vicinity”)

Because the preposition у requires the genitive case:

• у + genitive → у озера The base form is озеро (neuter), and its genitive singular is озера.

Russian word order is flexible. The sentence:

• Вечером я люблю посидеть на скамейке у озера. is natural and highlights evening as the setting.
  You can also say:
• Я люблю вечером посидеть на скамейке у озера. This sounds fine too; it places slightly more focus on I like and then adds in the evening as extra information.
  The most natural choice depends on what you want to emphasize.

You can omit я because Russian verb endings already show the subject:

• (я) люблю = I love / I like
  Omitting я often sounds more casual or more “narrative.” Including я can add emphasis or clarity (especially in contrast: я люблю, а он не любит…).