Bob:

See this link at the MS site for a table comparing the versions of Windows Server 2003.  Technically speaking, you can run DNN from Windows Server 2003 Web edition, but my recommendation is that if you can afford it, get the Standard version.  The Standard version is the server with all the features everybody is used to, Web Server edition is a cheaper version where MS removed some functionality not deemed necessary for a server only used as a Web server.

You do not need CALs for any Internet access.  See this link for the MS licensing policies.

The number of concurrent users is a sticky subject and not an exact science.  One thing I can tell you is that DNN itself is not very CPU intensive (except when it is starting) but memory is more of an issue, this should come as no surprise but the more the better.  I have a server with 2 older slow CPUs but with 2GB of Ram and it works great, but it is low traffic.  How many users are you expecting?  Also, will you be running SQL Server on the same box?  SQL Server will also work better with more memory.  A T3 is a good pipe, and I don't think anybody could give you an exact number of concurrent users you should be able to support but I can say that it is going to be a bunch.  Of course, this depends on the nature of the site, is it going to be data intensive or just a company brochure type of thing?

Good luck with your project, keep us posted of your progress.

Carlos