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Since you said you won't be networking, I'm assuming you'll be transferring those text files via a disk or a CD. As such, you should have no difficulties there. If it's plain text, you may have an issue with line-breaks (you sometimes get the crazy ^M instead of a a line-break) but that's easy to fix with the standard "dos2unix" command which will likely be included in your distro (RedHat, Mandrake, whatever).
As for Photoshop -- No dice. Photoshop won't run in Linux. But if say you keep Windows on there, even then running Photoshop would be painful due to the lack of processing power and RAM.
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