Within six inches? If so, yes the RS232 connection will work great under most circumstances. Six feet will work fine too, but the cable could be more sensitive to mechanical/electrical noise interference, so it is recommended to use a shielded cable and to ensure that the communications cable is not in the same conduit as other power/noise producing cables and is not placed next to noise producing machinery if possible.
No setup is needed on the PLC side (other than baud rate and data format) because it is configured to respond to all Host Link and Modbus communication by default (it auto detects the protocol.
You can use the SETPROTOCOL function to fix the com port to Host Link or Modbus.
SETPROTOCOL 1,1 'set RS232 to Modbus RTU
SETPROTOCOL 1,5 'set RS232 to Host Link