trade in value back to the gift card or the credit card if I use both to purchase

Trade In value always goes back to the payment method used to pay, i.e your Credit Card. It does not go to your gift card balance

See the FAQ section here: link-> Apple Trade In - Apple

1. See what your smartphone is worth.

Answer a few questions to get your estimated trade-in value. If you pay monthly, we’ll apply the value as an instant credit to lower the monthly payments of your new iPhone. If you pay in full, we’ll credit your payment method after we receive your trade-in.

Depends on too many "ifs" we (who are all other users here and not privy to all of Apple's policies) - can't answer with certainty - main possible scenario: if you mail in the device and it is processed by a third party partner, they usually issue a gift card. But you best check with Apple. The easiest would be to buy/trade in in store if Apple will accept that. That way everything would be in one transaction.

Ahhh, I was going by this (on the very same page):

Trade in and get Apple Gift Card credit — even without a purchase. 

Not ready for a new device? You can still trade in a current one. We’ll put the value on a gift card you can use to shop for Apple products and services.

And, it also depends on whether the old device is traded in at the store or being sent in to a third party (which has to be done in some regions or if the COVID restrictions get changed again).