Do I need to have a web server available to use WebForms?
Yes, Web Applications need a web server that knows about ASP.NET, such as Internet Information Server (IIS). IIS is comes with a free web server that comes with Windows NT Server or Windows 2000 Server.
What about Windows 98, Can I use Windows 98 or Windows ME to create and deploy Web Applications?ME and Windows 2000 Professional?
These operating systems either come with, or have available Personal Web Server (PWS). You cannot use PWS to create Web Applications. This can be used for creating Web Applications, but are not great platforms for deploying them. You must create Web Applications using IIS on either Windows NT 4 Server or Windows 2000.
How can I learn more about writing HTML?
While WebForms make knowing HTML almost optional, having a good working knowledge of HTML will help. Take a look at one of the fine books out on the market (Teach Yourself HTML in 21 Days would be a good start) to learn more.