yes RH9 is free... but there are packaged sets that u can purchase, that contain all 7 dics, 3 binary cd's 3 source cd's and 1 document cd, and it comes with a handy reference guide that explains the setup etc etc..
I dont know of using the product key for updates.. u just have to register with the redhat network and download thier up to date ssl key thingo so u can connect and away she goes...
in regards to running a web server, you can pay for a domain or you can get one for free...
there are a few dynamic dns services out there.. i use no-ip.com basically by running a small client program, this will automatically update the server with your current IP (if it changes) and it will update its domain database so that your http://mydomain.no-ip.com
will always point to your machine at your current IP
Setting up apache is relativly simple... just use the mydomain.no-ip.com domain name throughout your configs and you will be underway.
Im running a mailserver, webserver, ftp server, IM server all off a free domain with a dynamic IP and i have no troubles... and the best bit.. its FREE