1. install suse or redhat (or whatever) with NO GUI
What's the point of installing these with no GUI?
When you install any distribution, it will ask you to choose packages. Don't select GUI packages.
2. then what are the steps to get the ability to ssh into other machines and run xwindow applications (e.g. install a minimal xwindows application, which one is best, etc., then do I stay at init 3 or do I need to go to init 5, all this is unclear...)?
To ssh from another machine into the server, install the ssh server package on thr server, and use clients on the other machines.
To display remote X windows:
On the server, install the program (and all required libraries).
SSH into the server and set the environement variable DISPLAY to xxx.xxx.xxx.xxx:0, where xxx.xxx.xxx.xxx is the client's ip. export DISPLAY
The client must run an X server.
On the client, run 'xhost + xxx.xxx.xxx.yyy', where xxx.xxx.xxx.yyy is the server's ip