Is a 1st gen IPAD still able to function? (download new apps, etc..)?

When you open an app or a game in iTunes Apps store and read a review about it you will notice there is also an information to tell you for which generation iPads it is compatible with.

I still use 1st gen all the time, mostly as a book reader and checking news and sports though, haven't tried any games.

Most apps require iOS 5 at minimum so you should be good for app support for a while. Get as many of your favorite apps now before they become unsupported! Because once a new version comes out and its only for iOS 6 down the road, then you're going to run into that problem. You can always back up old versions of apps and resymc old versions of apps back to the device if you ever have to restore.