Find this in lang/english.php and edit as you see fit:
'fav_lnk' => 'My Favorites',
And to put the menu items om the same line, find {SYS_MENU} and {SUB_MENU} in themes/your_theme/template.html and make sure there are no <br /> between them.. for the classic theme it looks like this:
{SYS_MENU} <br /> {SUB_MENU}
You could change it to this to have it all on one line, notice I added the " :: " just to make it look good.
{SYS_MENU} :: {SUB_MENU}
To edit the space between them, find $template_sys_menu_spacer in themes/your_theme/theme.php and edit as you see fit. For the classic theme it looks like this:
$template_sys_menu_spacer ="::";
If you can't find it in your theme.php file, then go to themes/sample/theme.php and copy all of this to your theme.php file (add it just above "?>" at the end of the file), and then edit $template_sys_menu_spacer.
// HTML template for sub_menu
if (!isset($template_sub_menu)) //{THEMES}
$template_sub_menu = $template_sys_menu;
if (!defined('THEME_HAS_NO_SYS_MENU_BUTTONS')) {
// HTML template for template sys_menu spacer
if (!isset($template_sys_menu_spacer)) //{THEMES}
$template_sys_menu_spacer ="::";
// HTML template for template sys_menu buttons
if (!isset($template_sys_menu_button)) //{THEMES}
$template_sys_menu_button = <<<EOT
<!-- BEGIN {BLOCK_ID} -->
<a href="{HREF_TGT}" title="{HREF_TITLE}">{HREF_LNK}</a> {SPACER}
<!-- END {BLOCK_ID} -->
EOT;
// HTML template for template sys_menu buttons
if (!isset($sys_menu_buttons)) { //{THEMES}
// {HREF_LNK}{HREF_TITLE}{HREF_TGT}{BLOCK_ID}{SPACER}
addbutton($sys_menu_buttons,'{HOME_LNK}','{HOME_TITLE}','{HOME_TGT}','home',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{MY_GAL_LNK}','{MY_GAL_TITLE}','{MY_GAL_TGT}','my_gallery',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{MEMBERLIST_LNK}','{MEMBERLIST_TITLE}','{MEMBERLIST_TGT}','allow_memberlist',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{MY_PROF_LNK}','{MY_PROF_TITLE}','{MY_PROF_TGT}','my_profile',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{ADM_MODE_LNK}','{ADM_MODE_TITLE}','{ADM_MODE_TGT}','enter_admin_mode',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{USR_MODE_LNK}','{USR_MODE_TITLE}','{USR_MODE_TGT}','leave_admin_mode',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{UPL_PIC_LNK}','{UPL_PIC_TITLE}','{UPL_PIC_TGT}','upload_pic',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{REGISTER_LNK}','{REGISTER_TITLE}','{REGISTER_TGT}','register',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{FAQ_LNK}','{FAQ_TITLE}','{FAQ_TGT}','faq',$template_sys_menu_spacer);
addbutton($sys_menu_buttons,'{LOGIN_LNK}','{LOGIN_TITLE}','{LOGIN_TGT}','login','');
addbutton($sys_menu_buttons,'{LOGOUT_LNK}','{LOGOUT_TITLE}','{LOGOUT_TGT}','logout','');
// Login and Logout don't have a spacer as only one is shown, and either would be the last option.
} //{THEMES}
$params = array('{BUTTONS}' => assemble_template_buttons($template_sys_menu_button,$sys_menu_buttons));
$template_sys_menu = template_eval($template_sys_menu,$params);
}