Tony,
I think you should download gimp and play around with it and see what it can do. It can create psd files, i am not sure what equivalent photoshop version the gimp psd would equal, but they open fine in ps cs. GIMP is available for all os platforms.
as for your text layers, yes, you can create any text and if the end file user has that font it will show up, otherwise photoshop will handle it in different ways. I think in cs, it will automatically rasterize the layer for you.
As for the hosting company, I would write them. I didn't see that the actual gimp was installed but different tools for gui tools, etc.
However, on the main page of that hosting company is this
"You can login as root, add or remove user accounts, compile and install any custom software, just like you would on a dedicated machine, only for a fraction of the price. "
Here is the link for gimp
http://www.gimp.org/