Help with Permalinks

Hi all,

I need some advice with regards to permalinks. I have recently installed WordPress on a server and my first website is up and running when I realised the ugly link structure which I now want to change.

So far I’ve been reading a few articles about changing the permalink structure which is very confusing.

I need to know:
a) Is a change to my permalink structure going to automatically include my old posts or are they going to break?
b) Do I actually need to edit my .htaccess file and to install mod_rewrite and if yes where can I find it? Is this a WordPress module?

btw, my host is running apache server.
Any other advice please let me know.

Many thanks in advnace