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Can an inquisitor start off embarked in a Drop Pod or can they only embark on to transports rather than start in them?

Yes. 'Authority of the Inquisition' speaks about what they can embark and if you set up a transport you can designate models that are embarked in it.

Yeah, the trick to this one is reading the intersection of two different rules. The Authority of the Inquisition rule, as Zeshi points out, says they can embark on any Imperium Transport. The rules for units being deployed inside a transport say units can "start the battle embarked on a transport". This tells us that starting a unit in a transport is "embarking".