RMS - The amount of continuous power, measured in watts, that an amplifier produces is called RMS power. The higher the RMS figure, the louder and cleaner your music sounds. When choosing an amplifier, the RMS rating is the power rating you should pay most attention to. Also, keep in mind that some manufacturers calculate the RMS power ratings of their amplifiers at different input voltages. For example, an amplifier rated at 100 watts RMS at 12 volts can produce considerably more power than an amp rated at 100 watts RMS at the more typical 14.4 volts.
Crossover - Crossovers consist of both a high-pass and low-pass filter. Often used to keep high-frequencies from reaching a subwoofer, a low-pass filter allows only frequencies below the crossover point to be amplified. A high-pass filter allows only frequencies above the crossover point to be amplified — useful for keeping low bass away from small speakers, so they can play more efficiently. Crossovers are usually listed as variable or selectable. Continuously Variable means the crossover can be freely adjusted to any frequency between the listed end points. Selectable means that you can choose from several preset crossover points.
Definitions from http://www.crutchfieldadvisor.com/IS..._glossary.html
As for wiring gauges, check out http://www.powerstream.com/Wire_Size.htm. The site has a chart listing the various gauges, their load capacities, etc. So, find out the maximum load of each of your devices, add them up, add a little more for future expansion and then match that figure to the next highest guage wire.
Yes, you can wire it up as in your picture but look around this site as people have come up with a lot of other ways.