I own a Dual 867 and yes the Eject button controls the top drive and Option-Eject controls the bottom drive.
Any IDE drive will do in the second bay. I have a "Windows only" 24x TDK VeloCD in my second bay and it works great with Toast. All drives are the same shape, just be sure that you take the decorative front panel off the drive before installing it. I didn't do this and after I installed it the door wouldn't open because it was hitting the edges inside the Power Mac : ). I then had to take it back out, remove the panel, and reinstall the drive which took about 5 minutes.
I'm not sure about how many IDE ports there are inside there. Nicely enough Apple has prewired all 4 hard drive slots and both optical slots with power and connection cables. There's also an IDE port on the mobo with nothing plugged into it, so maybe there are 4 separate buses? One for the Optical drives, one for the vertically mounted hard drives, one for the horizontally mounted hard drives, and an open one. I guess the open one is because in the manual it suggests for maximum optical drive performance you have a Master drive installed on the ATA 100 and the other one the Master on the ATA 66 port which comes unused. I'm thinking of installing another couple burners inside there, maybe 4 48X burners will have me cranking out a lot of CDs if I just carve some more drive bays in front of the computer's case : ). This is addition to the .48 TB of hard drives I could install, wow.
Anyway just be sure that you look at the Toast compatibility list before going to the store. Almost any drive will work. One suggestion is to not go so cheap that it doesn't have burn proof technology. I have both my drives with burn proof so I burn CDs simultaneously in the 16x burn Combo drive and the 24x burner I installed and have no problems.