You're in the wrong group for this, but seeing as my job involves
providing tech support for these devices, I'll answer anyway.

Yes, the majority do.  A properly configured device on both ends and an
uncongested network, using the higher-end speeds (384kbps and above for
NTSC video) can yield video and audio that is incredibly close to
broadcast quality.  If you want something that's near-bulletproof and
not subject to heavy internet traffic congestion, you can opt to go over
ISDN lines IF you're willing to pay the extra $$$ for it.  Encryption is
offered as well.

Depends on your organization and how frequently you interact with
distant offices.  The organization I work for is spread out over
multiple distant sites that require frequent interaction, and not a day
goes by without one or more videconferences taking place (in fact right
now the board is lit up and nearly every conference site we have is in
use, due to discussions over the hurricane situation).  Some of our
links are ISDN for carrying mission-critical or information-sensitive
conferences where eavesdropping can't be tolerated, but most are IP
based (using the good ol' internet) and encrypted for reasonably-good
security.

Before the days of prolific videoconferencing, we got the job done via
audio-only conference phones, cellphones and tie lines, and a good
portion of that old inrastructure is still there as a backup. But most
of the people I work with can't imagine life without videoconferencing
anymore.

If you have a spread out organization, then yes.  If you're only going
to use the gear a couple of times a year, then I can't say the cost
would be justified.  For infrequent distant communication, a good audio
conference phone (I recommend the Polycom Soundstation series) is good
enough.

Tandberg and Polycom are perennial favorites.  My shop uses both, and
they play nicely with each other.  If I had to choose between the two
though, it would be Tandberg all the way.

STAY AWAY FROM SONY.  They are trying to enter the videoconference
market with their own units, however they have their own
"interpretations" as to how the internationally recognized protocols for
videoconferencing should be applied.  I know of one corporation that
uses them exclusively, and myself and everyone else that has had to
connect to their equipment has found it to be a total nightmare.

In what way?

The picture isn't so much dependent on the unit itself (as long as the
unit is H.320/H.323 compliant), but more on the speed of the data link
and the camera you're using.  I've found that units with built-in
cameras produce terrible video UNTIL you hook up a high quality external
video camera and run your conferences through that.  In any case, nearly
all of the gear out there that's complaint with the standards is "good
enough."

Furthest range in what way?  I don't understand.