Linux doesn't need a swap partition. But it's nice to have. Otherwise you risk invoking the rath of the OOM killer.
Knoppix runs completely from CDROM. In your RAM it will make a little virtual drive you can work with.
If you want you can have Knoppix install itself to your harddrive if you want, but I prefer just to install Debian Sarge, since that's what it is based off of.
STD version is the network security version, and takes a way a lot of the normal programs and replaces them with a bunch of network "hacker" tools. Stuff like packet sniffers, nmap port scanner, and bunches of other security testing tools.