Clicking on a page creates headline type, which is fine for single words as it does not wrap around to a second line. Click Enter or tick the Tick Box to set it. The Transform Tool (CMD + T) alters the font size.
Clicking and dragging produced a type box, containing sample text, which wraps around at the end of each line. Delete it or highlight it (CMD + A) and start typing to add text.
Creating type automatically creates a new layer to put this on.
Change font size and other font characters by clicking on the Move Tool (Don't use the shortcut V or it will just type the letter v) and entering new values in the Type Dialogue Box. The Transform Tool (CMD + T) alters the size of the Text Box but not the font size.
Advanced Font Features
Some fonts have alternative styling for some letters, which hopefully show up when you highlight a single letter. However, some fonts need to have the Glyphs Window open, which highlights the letter you are on, and you can then pick the alternative styles in the list.