They usually include the source code. Linux is particularly well-suited for a school environment for several reasons. Firewalling and other forms of network security are built into the OS, and Linux supports them at the kernel level. As with most types of UNIX, viruses are virtually nonexistent in Linux. There are also a number of drivers available, and Linux does not throw away the obsolete drivers just because someone thinks no one uses them any longer.
Schools are generally on limited budgets, so they often have to make do with older hardware.
Most importantly, with Linux a standard PC can be used to run an entire classroom of 25-30 workstations. When project development began, Slackware was used before migrating to Red Hat Linux 4.1. Even though it was not free, at the time Red Hat was the easiest to install and had the most professional installation interface. Essentially, it had everything needed right out of the box. RPMs make it easier to install updates and fixes, and it provides a common database to search through to determine which version of a specific package is installed.