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Just two words put S second and E third, and the two have nothing whatever in common.
It is the plural of user and turns up constantly in writing about software, services and drugs. A puzzle landing on this pattern almost certainly wants it.
A pseud is someone who pretends to knowledge or taste they do not have. The word is British, informal and slightly dated, and it is short for pseudo intellectual.
It also carries a silent P, which USERS does not. The two entries share the S and the E and diverge in every other respect, including their opening sound.
With two words on the page there is no distribution to read. Confirming S at two and E at three leaves a straight choice between two words.
S followed by E needs a single letter in front and two behind. English builds almost nothing that way at five letters, and what survives came in by different routes.
Yes, it is established in British English and appears in standard dictionaries. Private Eye popularised it with its Pseuds Corner column.
USERS, comfortably. It is far more common and it uses letters you are likelier to have already tested.
Neither does. Zero of the two carry a repeated letter anywhere.