The power of a lens is the reciprocal of its focal length in meters. A convex lens has a positive focal length, so its power is also positive. The image formed by a convex lens is always virtual, erect, and magnified when the object is placed between the optical center and the focal point of the lens. In this case, the object is placed at a distance of 20 cm from the optical center, which is greater than the focal length of the lens. Therefore, the image formed will be virtual, erect, and magnified. The power of the lens can be calculated using the following formula:
$P = \frac{1}{f}$
where $P$ is the power of the lens in diopters and $f$ is the focal length of the lens in meters.
In this case, the focal length of the lens is 20 cm, which is equal to 0.2 m. Therefore, the power of the lens is:
$P = \frac{1}{0.2} = 5$ diopters
Therefore, the correct answer is $\boxed{\text{C}}$.
Option A is incorrect because the power of a convex lens is always positive. Option B is incorrect because the image formed is virtual, not real. Option D is incorrect because the image formed is magnified, not reduced.