Welcome.

The first thing I'd do on a second-hand tablet is flash a fresh firmware image, which includes the OS and the standard applications. This will delete anything on the tablet, so make sure there's no files that you're worried about.

The 770 typically uses OS2006, but there are 770 versions of the newer OS2007 and OS2008 from the N800/N810. I have a N800, so I'm not sure which would be the best choice for you, you'll need to ask someone else.

Once the reflash was done, I might browse maemo.org, looking for some applications to add. If you browse on the device itself, installing new apps is easy.

The appropriate format for music and videos depends on the player software. For example, Mplayer can play most video formats, but it helps greatly if they're low resolution, since the tablets have modest decoding ability.