Linux has its roots among the Unix and Computer Science Academic community. Its original market was people who wanted Unix systems but couldn't afford the several thousand dollars it cost for a real Unix machine. There was a group in Cambridge who became the Free Software Foundation, who began developing their own version of Unix, but they had a lot of trouble with the kernel which runs it, then this brilliant Finnish grad student named Linus Torvalds wrote the Linux kernel, and with GNU tools you had an affordable operating system which ran first on x86 pcs, then was ported to Macs, (68000 then powerpcs) SparcStations, and you name it. The point of Linux today is that it can be made to run on everything from telephones to X-boxes to supercomputers.
X-Windows came from Unix. If you look at most film and TV footage of NASA and real university machines from the 90s you will see that most of them are running it. This is true of a lot of the packages which together make up the operating system. What in Windows really is a part of the Windows package, is separate components made by separate vendors in Linux distros. And that is where the fun begins. A lot of people use Ubuntu and don't go any further from it than Linux Mint. I first learned Linux as a user with an account at my college, where I was doing some C++ programming and surfing the web with Netscape on Slackware, then when I got my own Linux machine chose Red Hat for it. Right now I'm running Debian Lenny/Sid (testing/unstable it is also called) with plain vanilla kernels and Mozilla Firefox.
That's the thing about Linux distros. As Linus Torvalds says, the thing about them is they are easier to install then just going out and getting the main package. Then you can change them however you want to. Ubuntu is less different from other distros than many of its users realize: the user experience is slightly easier but otherwise almost the same, with the major differences being under the hood where you aren't likely to see them. If you don't like how a given package operates you can take it out and put in something from elsewhere.
I just checked the Linux Kernel Repository at http://www.kernel.org/ . The latest kernel is 2.6.24-git15. I'm compiling 2.6.24-git14 on this machine as I type. It's running 2.6.24 because all the other gits I've compiled haven't run. And there is no guarantee they will. 2.6.24 is the latest stable kernel. Gits are called snapshots. You can find an explanation at: http://www.kernel.org/patchtypes/snapshot.html where it explicitly says they may not work or even compile.
When dealing with any Linux distro you will have three types. Unstable, testing and stable. Ubuntu's testing (was unstable till just recently) is called Hoary Hedghog. Its stable is Gutsy Gibbon. Debian, which names all its releases after characters from Toy Story (and hey, John Lassiter who's behind Toy Story, Carz and other Disney movies designed the mascot for the FreeBSD distro of Unix), has Sid for unstable, Lenny for testing, and Etch for stable. Red Hat uses the Fedora distribution to develop and test its operating system. In essence you are able to use it for free, but you are their guinea pig in return. Currently Fedora is at 8. If you want to give them your money they are about to start selling their Red Hat Enterprise Linux (the stable distro) for about 40 bucks to individuals. Back in 2002 I bought Red Hat Linux for 40 bucks at Staples before they split Fedora off. I'd call it a deal but I'm thinking about switching back to Fedora because of my experiences with their livecd. Slackware is at 12 -- that is the latest stable release but you can upgrade to testing or unstable if you want to. The thing is, it's the closest thing there is to a plain vanilla Linux except for something I'll mention below. There's no point in telling you where to find the packages because you can probably build them from sources if you're interested. Gentoo is a Linux for a similar audience. It's up to 2008.0 and I've got an old pentium-mmx laptop recompiling the latest version of audacity on it next to me as I'm typing this. The closest thing to plain vanilla linux is the Linux from scratch project. http://www.linuxfromscratch.org. Yep. If you feel up to it they will give you support for compiling and installing your own Linux. How new can that be?
If you want information on the Linux OS go to http://www.distrowatch.com . That will give you the latest information on any distribution you want to follow.