Should cancel be a button or a link?
To summarize
The cancel option is similar to aborting an action, and therefore similar to navigating back to the previous state of the UI. Navigation is represented in web UI as hyperlinks, and thus the cancel option should be a hyperlink.
Why is the cancel button used?
Cancel is mainly useful for multi-step dialogs where the user has progressed past one or more pages with actions. At this time, pressing the Back button will not undo these actions and it would be better if the user would click Cancel.
Should cancel button be red?
The Cancel button should have a neutral color to signify the neutral, non-committal button. When users see that the Cancel button has no color, they'll recognize it as the fallback to safety easier. It's critical for users who need to escape a confirmation screen to notice this.