Linux, is a word created by none other then the father of Linux, Linus Torvalds. Linux was written using Minix, which is a Unix based system. Unix can be considered to be the original server OS (Operating System), it was created in 1973 by what is now AT&T / Bell Atlantic. It follows a platform known as GNU, which means, "GNU Not Unix". It was partially inspired by the GNU Project also known as "free". Linux became free because it had been the work of a large grouping of people. Today many small to middle sized companies run Linux, in addition to many home users. It is now ported (converted to) almost every large architechture some being: X86, PPC, Sparc, Alpha, HP, and more. It provides an alternative to that of the popular Microsoft OS's.
As for why anyone would use it, for the most part people fall into it. I know I began the usage of Linux due to my poor luck with the Windows OS. Being one of the most secure, and stable systems, Linux can be found on many workstations and the backend for servers. I'm sure that this site Tek-tips, is either Unix or Linux based. The other large factor for the usage of Linux, is its price...there is no price. Following the trend of the GNU Project, all Linux distributions are available for download. In addition, they sell copies for those who pay for licenses, tech-support, and manuals. For the most part, Linux is used, when you just can't stand the competition.
Using Linux for those who have never even heard about is a process. The first step, may be finding yourself a shell account to learn the basic commands. The basic commands for Linux are the same as Unix for the most part. There are different distributions of Linux, one can compare them to different flavors of ice cream. They are all ice cream, but some appeal better to others. Once can categorize the distros into three categories; Basic (mostly for noobs), Moderate (those who feel comfortable in both X and command), Advanced (know the in's and out's of the OS). There is no wrong distro, it all depends on the users knowledge and purpose. For me, when I use Linux, I use Gentoo (a distro that is installed entirely from source), I wouldn't have dared to try it a few years ago. If you are reading this, you are most likely new or just curious about Linux. I would recommend three different distros for you. Mandrake, Red Hat, or Suse. In my true opinion, Mandrake is the best overall.
I think that every n00b should stay as far away from X as possible, unless you plan on not learning the OS, or just using it as a word processor, you want to force yourself to use command. In Linux, you can do almost everything you can do in X in command. I'm writing the FAQ for a little intro to the idea of Linux. When I get a chance, I will write up a n00b's guide to command. Until then, this forum and others like it will provide you with sufficient support for you needs. For any questions regarding anything I've covered, contact me in any fashion provided.