About the distro, let's pact that we do not start a distro-war in this topic. Look around on http://www.distrowatch.org
to find the one that suits your needs.
I will recommend two distros which I think would be most appropriate for you and tell what knoppix is and state why.
is the longest-surviving GNU/Linux liveCD. A livecd means that it is not installed, it boots of a CD and works out of the box. On the downside, it does (usually) not save it's settings anywhere and you can't use the CD-rom while you are using it. My favorite liveCD would be Phlak
, because it's great for diagnostics and features an extremely good documentation on-the-disc(tm)
. Plus it features a big "block all inbound traffic" button
the oldest command-line-only-if-you-will distro is Slackware. This is one of my recommendations. If you really want to learn linux, start with this (or the other thing I will recommend). I do not have much experience with it but enough to tell that it's really reliable and teaches a lot.
follows the same basic principles than Slackware, plus it features the BSD-style ports system, portage, that makes program management easy as pie and not at all time-consuming. It is made to compile everything from source, which can be a good and a bad thing. The only con is that you actually have to have a broadband connection to consider it, because it's a lot harder to manage if you don't.
Good luck on distrowatch!