Having not had my mitts on a Time Capsule yet, I can't comment on it. However, to answer your other questions, Time Machine can place multiple machines' or multiple users' backups on one drive. That drive does not have to be a Time Capsule.
As I understood it, the chief perk to the TC is that it can run TM over a wifi connection, which other drives cannot, even when mounted as NAS. (I can't get any of my Macs to backup to my WD external when it's hooked to a standard wireless router. I can get them all to do so on one partition when the drive is hooked directly to each of them in turn.)