Do not forget to check out the FAQ section of both the FreeRADIUS (highly recommended!) and Xsupplicant Web sites!
8.1. Is it possible to allow user-specific Xsupplicant configuration, to avoid having a global configuration file?
No, not at the moment.
Yes. To use EAP-TTLS, only small changes to the configuration used in this document are required. To use EAP-TLS, client certificates must be used as well.
Yes. Windows XP SP1/Windows 2000 SP3 has support for PEAP MSCHAPv2 (used in this document). A Windows HOWTO can be found here: FreeRADIUS/WinXP Authentication Setup
Yes. FreeRADIUS can authenticate users from AD by using "ntlm_auth".
Yes. As of Windows XP SP1 or Windows 2000 SP3, support for WPA (PEAP/MS-CHAPv2) is supported. Other clients include (not tested) Secure W2 (free for non-commercial) and WIRE1X. Funk Software also has a commercial client available.