Having a customized ringtone is the best feature to have on any phone. I use this option as well to seperate callers. You can download different applications that allow you to complete that step. Depending on your type of phone you would be able to use the songs you love. If you have any addional concerns or questions.
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Yes, you sure can. There are a few methods to do so. If you use a Mac computer you can make ringtones, sounds, etc. via Garage Band. Older article but super simple: How to create a ringtone on your iPhone with GarageBand | Macworld
Other ways include using the iPhone and a computer (still super simply as well). Try this app. I've used it and it works great: http://itunes.apple.com/app/id599559607
After you record or select the music you want to make a tone you simply follow the on-screen instructions, which requires you plug the device into a computer. See below.