Absolutely. Different layers will be able to be rotated, warped, and otherwise reshaped independent of any other body part, etc. Then of course, as you said, they can be merged, or copy-merged. Copy-merge means to merge selected layers and create a new layer, leaving the original layers intact. Keyboard shortcut is: select layers to copy-merge, hold down ctl/cmd + shift then "e." When I do this, I usually group the original layers and turn off the eye for invisibility. Or you can convert those layers into an editable smart object and turn off its visibility till or if you need to get back to those original images.
If you have CS5 or 6 (maybe 4 but I don't think so) you can use puppet warp which allows you to manipulate even merged portions. It's a feature under edit, but if you want to use it, I would suggest looking up a tutorial first. In order to use puppet warp, a shape path must be rasterized. Right click on the layer and choose rasterize layer.
As for work paths, if you don't have it open, go to view and select paths. It will open as a new palette in your workspace. I have mine attached to my regular work panels so I can access it easily since I use paths often. Each of your shapes will have a designated work path. For simplicity, double click the specific path and give it a name. You can still access each path by clicking on the path layer. I just like to be able to see each path described. I also name each layer panel layer.
Here is an example of work paths and one of puppet warp to give you a very basic idea of what it can do.
Keep up the questions if you have more!