Ray,
I know little about the connection speed requirements for gaming - other than the fact that we have no problem with a 6GB broadband connection (Max 8GB, but we only get 6 where we live!).
We have up to 4 computers on the interweb, a PS3 and X-box 360, and 3 PSP's - not all at the same time, even my kids aren't that good!!
The X-box live 'package' can be bought monthly, quarterly or annually (by scratchcard) for various amounts - the £30 you mention sounds like one of the cards I've been conned out of buying in the past, but i don't recall how long he got on the web for that price.
To pay Fifa soccer / comat duty war of the worlds 7 or similar, you need the game disc in your machine, and your 'opponent' also needs the same disc (unless there is a way to fiddle it).
Any more than that - I suggest you ask any 12 year old, as they know far more than us old gits
