Make sure it can handle big drives. If not sure, get a Silicon Image chip controller card.
Anything will run Nicely. CentOS will get you more docs than you can ever use, Debian is easy to set up w/o docs, and Ubuntu is like that but w/ newer stuff.
For controlling it: OpenSSH is your buddy. OS X aught to just have SSH on there, for Windows you need to get Putty (OK, not a requirement, but it's the best). It will be like sitting at the terminal on the machine. Also, with some distros, it will be easy to set up Webmin, which can be handy.
Other cool things? Print server, streaming music server (Slimserver does not require a Slimp3 or Squeezebox, and can use iTunes' library), and...I dunno, a random box to play around with
.
So debian is completely command line based or I would have to use the command line to communicate with it?
Er, yes. I mean you can have a GUI, and it can help sometimes, but all the real controls are command-line and in text files. For n00b use, remember that nano exists as a text editor. vi and vim are neat, but can be confusing, and sometimes get in the way when you accidentally use a feature.
Would I set it up by plugging the dell into a screen, keyboard, and mouse and then once it is set up just do it remotely?
Yes. Make sure the BIOS is set to not stop on any errors.
What did you mean by gui configure tools? Is that at the dell end or a computer connecting to the dell?
On the Dell. However, you most certainly
can run such tools, they will just be slow. However, those I've seen are mostly pointless. Basic curses and curses-like interfaces (text menu displays and stuff) may not look nice, but they work good.