cleverhandle's got a point, if he had phrased it a little more nicely... a lot of these questions can be answered fairly easily by searching, while others have answers that are a little more involved. That said, I'll try to help the best I can without writing a novel... I'll let you or others take it from there.
1) Red Hat and Mandrake are just two of many distrobutions of GNU/linux... linux more or less just refers to the kernel, which is the core of the operating system. The newest stable kernel is 2.4.something, I'm not up on that, since I'm fairly new to linux myself. There are newer 'testing' versions... like betas... for the more advanced, but when you download a linux distrobution, it more than likely is based on the latest (or close to it) stable kernel. Anyway, Red Hat and Mandrake are probably the most popular, especially for linux newbies, but other popular versions are out there that have different features. There isn't really a 'best', it's personal preference. Check out linuxiso.org to get an idea of what's out there.
2) Like most programs, more CDs just means more extras... the basic linux operating system isn't too big at all... more space is needed for big applications like Xfree86, various desktop environments, etc, etc. So that's what the extra CDs more than likely contain as well... extras packages (programs), documentation, etc.
3) Yes... check just a few topics down for a discussion.
4) Search the forums for this also... short answer is, it depends on the game, among other things.
5) Yes, you can download it for free... most distrobutions are free. Will you get support? Not phone support or anything... but there are linux discussion forums everywhere, multiple faqs, etc... not to mention that linux itself has pretty good documentation if you learn how to use the man pages. The answers are out there, though.
6) Yes and no. Distrobutions like Red Hat and Mandrake will set up your system with a desktop environment that will feel fairly familiar, but what makes linux tick is definately different than windows. Linux is the sum of a parts... the theory being that there should be lots of little tools that do their jobs right, and then those tools are used together to get the job done. Windows one big (often buggy) tool where what you see is what you get. Once you start using it and get the hang of it, you'll see what I mean.
7) In my experience, no. But, like with everything, there is some hardware that has some issues... generally, though, some talented individual has come up with a solution. The only real consistant hardware issue that I know of is winmodems... aside from that, I don't know of any general devices that cause a lot of problems. Linux is also typically more responsive on less hardware... my linux machine is 2 years older than my windows box, yet I use it more because it's snappier for everyday applications. Anyway, check around the web to see if there are any problems with any of your hardware... odds are it will probably be fine.
8) In my opinion, they both have their benefits. Windows has compatibility going for it... everyone uses it, so a lot of the more popular applications (for the general public, at least) are designed for Windows... that's about its only upside, in my opinion, though. Linux is free, and has a great community working behind it to write packages that allow it to do everything windows can. Compatibility seems to be increasing all the time, stability is excellent... get past the learning curve, and you'll be set. I could write forever about it, but in the end, you should just try it.
If you're not ready to take the plunge and install it, download Knoppix from linuxiso.org, burn it to a CD, reboot from the CD, and you'll see linux in action... runs right from the CD, so no worrying about installing/repartioning/etc if you're new to all that. Even better, do what I did at first... get an older system that isn't mission critical and install linux on it to play around with.
Hopefully this helped... I'm too worn out to type anymore... good luck and have fun!
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