Let's start with some simple answers...
Is this a huge undertaking for a web developer?
Depends on your level of experience and how comfortable you are with breaking and fixing things.
What's the level of difficulty of maintaining a server and keeping up with the latest security patches and all that kind of fun stuff.
Package updates (I refuse to endorse source-based distros like Gentoo anyone who's not already a guru) are easy; securing web apps can be quite difficult, depending on what functionality you're trying to achieve. Web Application Exploits and Defenses is an interesting exercise in teaching developers to write secure applications, once the basics like PHP security and SQL injection are out of the way.
Can someone also recommend an OS for my case, and maybe some good learning resources that's concise and not too overwhelming.
Ubuntu is fairly newbie-friendly but may be too "simplistic" for some people's tastes. Both the distro and the community have a few strange ways of doing things, but filtered through a reasonable degree of cluefulness you should be able to achieve almost anything.
It's a good idea to try and find a community that you can ask questions of - IRC, and specifically the Freenode network is good for anything open-source related - and forums are good for almost anything, if you can find the right one. Real People Who Know Things are also invaluable when starting out.