No. Processing's Python Mode is implemented in Java, and relies on the Jython project's implementation of the Python programming language. You can use any "pure Python" module, meaning any Python module that has no "native code" component. Just copy the module (individual .py files or a directory tree of .py files) into your sketch directory, and import it as usual.

The Python standard library is included.

Yes, or at least almost all of them. Python Mode introduces the add_library('library_name') function, which puts the named library on your sketch's class path, and imports its class names into your sketch. For example, to use the PeasyCam camera-control library:

add_library('peasycam')

def setup():
    size(600, 600, P3D)
    PeasyCam(this, 100)

def draw():
    background(0)
    rotateX(.5)
    rotateY(.2)
    fill(255, 100, 100)
    box(30)
    pushMatrix()
    translate(20, 0, 0)
    fill(100, 255, 100)
    box(8)
    popMatrix()

Some libraries--those that depend on certain functions being defined in your sketch--will not work. As we become aware of those, we will try to work with the authors of those libraries to make the design compatible with Python Mode, or at least to provide workarounds.

Python Mode is source-compatible with Python 2.7.3.

We intend to have an extensive example portfolio finished in time for the academic year beginning in the fall of 2014. There are already a few examples from the standard Processing mode ported to Python, and more will appear over time.

We intend, also, to port the reference documentation into Python syntax. However, in the meantime, you may refer to the standard Processing documentation, and remove the semicolons!

First, install version 2.1.2 or better of the Processing Development Environment. Then, install the mode as pictured below: