You have to understand the difference between an Update and an Upgrade.
An Update is a free change to add to the base code or as a bug fix within an existing Operating System. Such as the .8 added to 10.5.
An Upgrade is a complete new Operating System that must be purchased. Such as 10.5 Leopard to 10.6 Snow Leopard.
10.5 Leopard was based on Power PC code and was written to be able to run on both Power PC and Intel processors.
10.6 Snow Leopard has completely rewritten code and only runs on Intel Macs.
10.7 Lion used some 32 bit which allows it to run on Late 2006 through Early 2008 MacBooks and a lot of 64 bit code.
10.8 Mountain Lion is pure 64 bit, which excludes more systems than Lion did. It can only run on the Late 2008 through Mid 2010 MacBooks. It's not something you can add memory to, for example, as it involves the base architecture.
The 10.6 Snow Leopard DVD is back in the Apple online store. You can now get it for $19.99 without having to phone the store. http://store.apple.com/us/product/MC573/mac-os-x-106-snow-leopard
The Early 2006 model 1,1 Core Duo can only run a maximum of 10.6 Snow Leopard.
The models Late 2006 Core 2 Duos 2,1 through Early 2008 4,1 can only run a maximum of 10.7 Lion.
The Late 2008 model 5,1 Aluminum Uni through the Mid 2010 White Uni model 7,1 can run 10.8 Mountain Lion.
To see which model you have go to the Apple in the upper left corner and select About This Mac, then click on More Info. When System Profiler comes up check the Model Identifier and post it back here.
Once you are at 10.6.8 Lion is still available from Apple. You will have to call Apple Customer Care 1-800-692-7753 or 1-800-676-2775. to purchase it. Then within 3 days you will get an email with a code which you can use to download Lion from the App Store. The price is $19.99.
You must have at least a model 2,1 MacBook. Lion will require at least 2gb of RAM but really needs 4gb to run smoothly.
As for third party programs see this list for compatibility with 10.7 http://roaringapps.com/apps:table
Also Lion doesn't run any Power PC programs. To see if you have any Power PC programs go to the Apple in the upper left corner and select About This Mac, then click on More Info. When System Profiler comes up select Applications under Software. Then look under Kind to see if any of your applications are listed as Power PC. Universal and Intel will run under Lion.
Before Mac switched to Intel processors in 2006 they used Power PC processors from 1994 to 2005. Power PC 601 through 604, G3, G4 and G5. Applications written for the Power PC processors need the application called Rosetta to run on Intel processors. This was part of the Operating System in 10.4 and 10.5 but was an optional install in 10.6. With 10.7 Lion Apple dropped all support for Power PC applications