[Jeff]

1) Yes, this is possible:

import viz
import viztask

viz.go()
gallery = viz.add('gallery.ive')

def changeFOV():
	yield viztask.waitKeyDown(' ')
	viz.fov(60)
	
viztask.schedule( changeFOV() )

2) You can check the distance between the viewpoint and each billboard using the vizmat.Distance command. The check can be done within a timer function on some regular interval. Based on the distance you can swap a new model in.

If you have access to Vizard 4 this can be accomplished using proximity sensors.