Two more questions these are not directly PRC related.
I know you can have players with edited copies of the dialog.tlk file so spell/feat descriptions can accurate to server side modifications. Can you do the same with a prc tlk file in order to update the spell descriptions client side?
Yes, my server uses a merged / modified PRC / CEP / Custom TLK file. I've made the following changes to the PRC content:
1.) Pyrokineticist has been renamed to Elementalist.
2.) Dragon Disciple has been changed to Drake Child, I've also converted certain dragon heritage feats to their closest drake counterparts.
To what extent can you edit 2da file server side and the players are effected by it. From what I have seen the contents can be modified as I have seen 2da edits to change polymorph appearances. Are all the 2da files server side like scripts?
As long as you put the edits in the tophak the changes will be active. I'm not sure if all the 2das are serverside, but I think the main ones (classes.2da, racialtypes, appearances.2da, etc) are. This would be pretty easy to test.