As a former DraCo owner, the issue might be the 4MB VRAM on the gfx board. It's very limited, and you can not get good modern resolutions+refresh-rates. So you have to start with low res and "work" your way up (that was how I did it). If I remember correctly, it was possible for me to get a simple 8-bit 720p display out of it on a Samsung LCD monitor.
As for the OS, I was running both the supplied OS3.1 and the cloned OS3.5. I guess (but don't know for sure) Linux might have worked on it.