Quick and dirty:
You can only do 2MB Chip Ram max and 16mb Fast onboard + whatever your acclerator card allows.
Choice in monitors is yours, but since you have a Picasso, you're gonna want to use the 19" Sony. 1084 might be better for gaming depending on your preference.
Yes, most old PC IDE drives work fine with the IDE port built in.
3.1 Kickstart and OS3.9 is what I'd be using on an 040 setup such as yours.
And yes, Deneb to do USB Ethernet among lots of other things would be ideal in your case.
Nice system!
