1) In MDK 10.1 you should at least have these installed : gcc-c++-3.4.1-4mdk, libgcc1-3.4.1-4mdk, gcc-cpp-3.4.1-4mdk, gcc-3.4.1-4mdk
So do an
It will ask you to put the proper CD (if you did a CD install in the first place) in and you should be good to go.
2) Future versions of MDK will have new versions that you can choose during install or afterwards (as done above).
3) Nope. The kernel source is only needed for compiling a new kernel (duh!) and additional (external) modules
to the kernel, like the NVIDIA binary and such.