If I want to work on a PC with no disks - is it possible to configure Linux to start over the LAN from an installation on a server.
How to do it?

I believe you can do it via editing the fstab and making sure that your / is pointed to the server.

The problem that I see is getting it to boot up. I don't know if you can boot it up over a network (I'm sure there is a way I don't know it though...the BIOS probably has an opinion to boot over network or something)..but what you could do is burn a boot CD and then have it umount /boot after mounting / ....This way you can just leave the CD in the drive and it should boot up just fine. Or if you don't have a CD-ROM you could use a floppy -- the kernel would just have to be small.

Take a look at the Linux Terminal Server Project:
http://www.ltsp.org