Depending on the size of the bezel, yeah, a 30" would fit in a 29" space.
No real use of using HDMI over DVI other than audio.
Whether or not it has a HDMI port is dependant on which model of the 9800GT you have. The plain reference one doesn't, but some do. Just look at the back of your PC if you can to tell.
For general browsing, in Windows you can increase the size of the fonts used to compensate for the larger resolution. However, for programs, it's independent of each one. My own sight is far from perfect, but my 23" 2048x1152 @ 102 pixels per inch at 2-3 feet away form me is still easily readable, while 30" 2560x1600 res monitors have a slightly lower 100 pixels per inch. Whether or not the text is readable would mainly depend on how far you are away form the monitor.
The Apple Cinema 30" 2560x1600 is something around $1,990. For $1,900, you can pick up a iMac 27" with a i5, 4GB, 4850m (pathetic GPU to put with such a powerful display), 1TB. Both are IPS monitors.
If I managed to scrap up a grand or two to get a 30" and run it at 1280x800, I would attempt to see if the theoretical is correct... however, I spent 2 grand on my computer already. Toms has a 30" or two (judging from the 2560x1600 GPU tests they do), so send Chris Angelini or someone else from the staff a note to test it for you, I'm sure they'd be glad to help.
Edit: I am personally considering the Samsung 305T. It's worth about $1,200 new. It's also a 2007 model. It's a decent PVA panel at a TN panel price, with quality comparable to a IPS panel. I love Samsung.
Your classic 300cd/m2 brightness, DVI-D, 178/178 degree viewing angle etc.
With the stand it's 27.1" x 19.8" x 11", and weighs 26.5 lbs (so I hope you have a hearty desk).
Only one issue, no HDCP. So if you want to watch Blurays, you either have to crack em' or watch them form something else. No HDMI either.
A Dell 3007wfp-hc is also a considerable choice. Also from 2007, it's on the lower end of the spectrum of IPS panels (produced by LG), but still comparable to high end PVA panels. $999 for a 30" IPS! Dell states it natively supports both 2560x1600 and
1280x800.
http://www.costco.com/Browse/Product.aspx?Prodid=11269564&whse=BC&topnav=&browse=&lang=en-US
Maybe I need to start shopping at Costco...
For televisions, 1080p is more than enough. Most HDTV is still only 720p, and only Blurays and the such are 1080p video. Consoles generally run at 720p and 1080p upscaling, though the Wii/PS2 run at 480p.
If you're willing to spend $2,000 on a new monitor, why aren't you willing to upgrade your graphics card?
So yeah, your choices are: 30" 2560x1600 for $1,000-$2,000 and $150 for a new GPU
~OR~
$500-$800 for a 26-30" 720p/1080p TV.