I'll give you some ideas for some of your questions.
1. It depends on what your server is doing. There is a lot of remote administration tools like IBM's Remote Supervisor Adaptor and HP's iLo which both give remote monitoring and remote control of the server, even when turned off. As long as the server has network and power plugged in, you will be able to partially manage it.
2. See above, that will fix alot. Anything hardware you will need remote hands (normally cheaper than mailing parts back to yourself then back to the colo again)
3. Depends on it's use. You can't really give the best server based on rack space.
4. Pro's:
Cheaper
Potentially less maintenance
Cons:
No failover
potential performance limiting
Why not investigate load sharing to host the sites over multiple servers?