AND NOW HERE'S THE NEWS: You've seen Michael McDonald on MTV, you've heard his song "Sweet Freedom" in the recent film "Running Scared." But now you can see him in an unlikely spot: the popular CBS-TV soap opera "The Young and the Restless." Don't worry--McDonald hasn't formed a new band with "Young and Restless" star Michael Damian (who plays rock star Danny Romalotti in the show). Instead, McDonald will make a guest appearance on the series in an episode where Romalotti and teen model Cricket Blair (Lauralee Bell) aid pregnant teen-agers by putting on a rock concert in the fictional town of Genoa City. (The show will air Friday at 12:30 p.m. on CBS.) McDonald will perform his new single, "Our Love" and "Sweet Freedom," while Damian will perform a pair of self-penned compositions with series regulars Beth Maitland and Tracey Bregman. . . . And speaking of good causes: Local rock club Raji's will host a benefit for the Dead Kennedys' Jello Biafra on Wednesday. The show, whose proceeds will help Biafra defray legal costs in his obscenity battle involving an alleged pornographic insert in his group's current album, will feature X's Dave Alvin, the Long Ryders' Sid Griffin and members of Thee Fourgiven, the Untold Fables and the Fiends, as well as other prominent local musicians. Admission is $8.