1. No. You can install it all together. However, I suspect you may have misinterpreted your friend's advice. On a single Hard Disk you can split it into what we call partitions. It is a good idea to have your operating system on a separate PARTITION but on a separate Hard disk is a little over the top IMHO.
2. Most motherboards come with on-board graphics which is perfect for anything apart from the most demanding CAD or games software. You don't say what you plan to use your PC for but I would doubt you needed any Graphics card at all.
3. This depends on what you have in you PC - the faster processors need more power. You can pick up very powerfull PSU for little more so I would go for 700W, especially if you do want a graphics card as well.
4. I'm not much into this side of things, others may have a firmer view.