1. definitely incorrect.
2. acceptable. But it's never said that way.
In conversation. one would say one of the following. And let me tell you when and why:
1. a hundred fifty four dollars and twenty.
AND is usually omitted in conversation by Americans.
2. a hundred fifty four bucks twenty.
This is even more informal. But this is what will always hear.
3. One Hundred And Fifty-Four Dollars Twenty Cents.
Only for writing cheques. It's preferable to put AND before DOLLARS and not CENTS. But between dollars and cents are also acceptable.
But e.g. 20c or $0.20, one would simply say twenty cents.
NB: British uses Pounds (or informally, quid) and Pence.