I will try answer step by step on your questions.
1) The differences are not in environment only, but in concept completely.
For example: Most code is server-side - not client-side. Most control's events are handled on server - not on client.
2) Yes, you can make everything in ASP using HTML tags in any text editor or using InterDev or FrontPage, but debuging is more more more difficult.
Yes, it much easy to make it with ASP.NET
3) You must install "MicroSoft Visual Studio.NET" if you want use ASP.NET and ADO.NET technologies.