I feel bad for people starting, and that is what I always try to log in this site and answer questions.
I'll answer the original poster's questions to the best of my ability.
First off, classic servers and most of the other servers (Gaheris and Mordred are completely different) are nearly the same. The only differences of classics are the following:
1) No master levels (these are a series of 91 encounters you do not that unsimilar to quests, but that require many people to do). master Levels give characters extra abilities. For instance, a cleric can get Cure Nearsight and Group Cure Disease as Master Level abilities which are very useful. Pet charming classes or summoning classes have a Master Level ability that turns their pet into a huge version of it, many levels higher than what it normal was for a few minutes. Some of the Master Level abilities are incredibly powerful and definitely change the game.
2) No artifacts. Artifacts are some of the best gear to get. They have stat cap increases, and often have bonuses to melee or casting damage. They also regularly have /use or /use2 abilites which are very strong. These don't change the game as much as Master Level Abilities, but are also game changing
3) Buffs must be done in group. In ToA servers, most serious Realm vs. Realmers have a 2nd account in which their character is buffed. If you do not have access to a buff-bot, your character will perform much, much worse. In classics, if you buff someone and then drop from the group, the buffs also drop. It helps balance the playing field.
4) No /level to 20. On most servers, if you have a Level 50 on another server or your current one, you can automatically start at level 20 by typing /level when you speak to your trainer. This helps create the "ghost town" you are talking about. On classics, all toons start at Level 1. Unfortunately, power leveling is not that difficult in DAoC, so if you have multiple accounts or know someone, you can go to a high-con area grouped with other people and level much faster than you can doing it the way it was meant to be.
I guess a fifth difference is that the Trials of Atlantis areas don't exist in classics, but really the only reason to go to ToA areas is to do Master Levels, Artifact Encounters, or farm for scrolls.
Now, reasons to choose one or the other. The original poster is correct.....if you go classic, you will miss a portion of the game. The Master Levels and Artifact encounters are certainly entertaining, and as I said, game-changing. The reason people are swayed to classics is because you NEED the artifacts and Master Levels to compete. The gear is easier to get in classics. It is up to you to decide how dedicated you are. You CAN overcome your Newbiness and succeed in ToA servers, it just takes more work and patience.
Now, for what realm to go to, that is always a hard choice. You will experienced ghost towns in all of them, on all servers in the newb areas. Now, just today, I saw a group of six sub level 10's running around Mainland Alb on Caerleon. This was very surprising, because sub 20 toons are rare to say the least. The thing you have to remember is DAoC is about the end game, not the leveling game. People want to get to 50 as fast as possible so they can start playing the real game. The leveling is considered a grind to them. If either of you want some help, come to Lancelot (or any Caerleon server (iseult, pellinor, kay being the other three) on Albion and I will try to help you out. I will let you join our guild which is helpful to new people.
Now, for what classes to choose. That is difficult to say also, because some classes excel at PvE and can help get you financed easier, whereas other toons excel in RvR. All three realms heavy tanks are solid choices in that they are good PvE and PvP. Healing classes are always wanted, but good luck leveling a healing class (clerics, druids and healers) without someone to level with. I would say go Bonedancer in Midgard, Enchanter or Vampire in Hibernia, or Cabalist/Sorceror in Alb. That way you have a toon that is good in PvP and also is inexpensive in leveling (casters are cheaper to level up than tanks..tanks NEED good gear..the classes I recommended let their pets do the work and pets don't need gear). Albion is the realm considered most PvE friendly, and I can say many people in our guild could care less about RvR and just level up toons all the time.
The game has come a long way of at least explaining some of the way it works in game to help newbs, but there is still so many questions you must have. The new starter guilds sometimes are helpful to answering questions, but not always.
Anyway, feel free to ask more questions here, and I'll try to help you out.