1. Yes, it is possible to have multiple OS's on a single computer. Check in the Linux forum, and they'll help you with it. Although, I believe that most Linux distro's will automatically see the windows OS, and install themselves on another partition.
2. Name the specs that you've got. Most likely, they'll work with a Linux distro. I've heard of some more recent Linux distro's running well on P2's.
3. Games aren't usually written for Linux. Some people say that it is harder to write programs for Linux/Unix. Personally, I think that the gaming companies don't believe there will be enough demand for Linux games. You can use Wine or Winex, which try to emulate Windows, but it doesn't do so well.
4. Depends on you.
Sorry, gotta go. Will try and edit this last response later.