Here is a resource you can review on some possible causes:
I doubt you have a cyst--the MRI almost certainly would have revealed a cyst. However, when it comes to meniscus tears MRIs can be very misleading--there is about a 20% false negative rate. That means you have the injury but it doesn't show up on the MRI. In the end, the best way to know for sure is for a surgeon to go in there with an arthroscope (a camera) and actually visualize the meniscus and ligaments of the knee. But you typically don't want to do that--it is surgery--until you have ruled out conservative treatment options.
I'd suggest you try to work with a physiotherapist or a chiropractor with training in chiropractic orthopedics to see if they can help. And I would do what Kelly Starrett calls "self-maintenance"--get his Supple Leopard book and really learn to work all your soft tissue and get stretched out well. The fact that rest helps you suggests there is some soft tissue issue going on there that gets a little better when it calms down.