You can indeed. You just need to ensure that in the users group they have "Can upload movies?" selected
Image types are gif, jpeg, jpe, jpg, png, webp and video types flv, f4v, wmv, mpg, mpeg, mp4, mkv, m4a, m4v, 3gp, mov, avi, webm, ogg, ogv
If someone had the direct link, they would be able to use that direct link. They would of course need to know the link in the first place
You would always be charged your full renewal price for whatever applications you currently own.