When you create a new open challenge there is a checkbox to restrict the rank… clicking on that will expand some options to allow you to set an upper and lower bound. There’s also the option to set handicap preference.
If you cancel a game within the first few moves the game will be annulled and will not count towards your rating.
Of course in Ladder challenges if you do that you will automatically forfeit your place.
I don’t think I have created a new open challenge. I was just challenged by a 12k (I am 3k) and the game simply began. Are you saying if that happens, and I don’t want play I cancel it? If so, how do you cancel a game?