I have been considering using mod_rails (Phusion), however i wanted to ensure this: Once it's installed, I'm able to still serve regular, non-rails applications in the same server without coming to a changes. Is correct?

It's correct. I am using Passenger inside a project along with other PHP projects and delay pills work fine (even some PHP files inside your public folder).

You may also set the passenger to begin stand alone (passenger start -d inside your rails root folder) and employ the mod_proxy and mod_rewrite from Apache to deal with it (redirecting the rails demands towards the rails application).

Yes, you are able to still serve non-rails programs utilizing the same server.

mod_rails instantly picks up which DocumentRoots are Rails programs by searching for public, for instance.