to be honest a friendly tone helps a lot
Nagios works on linux servers,. so you need a linux server, starting from scratch usually isn't easy, but the docs are good.
Monitoring windows server is a bit of a PITA but it works too...
a) install linux on a server. For the numbers you suggest every piece of crap hardware should do.. (ok, now don't take that too exactly, let's leave that 486 where you found it.
b) follow the quickstart guide in the nagios docs i linked and install nagios, yes, from source, it might take up to a couple of days to get it working but it's worth the extra effort when you need to fix things up, if you use RPMs you are on your own.
c) install the nagios plugins, if you did the core from source this is a joke
d) READ THE DOCS and understand how the files work together looking at the default installed config files.
e) install nsclient++ on a test windows server and start fetching data and see what you can do.
f) have fun on the other servers.
Sending emails isn't a problem, sending SMSs requires either a payservice from some provider (email to SMS) or dedicated hardware, if you risk being without internet connection for whatever reason the second is the only option, as you won't get an email to your provider if you loose the conneciton (or you install a second nagios server somewhere "outside" which monitors the connection to the first server)
Take yourself a week of time and a server and you should get it