There wasn't evidence that Ho-oh did so. Instead the evidence was towards Arceus, that shaped the world with 1,000 arms as the legend in Sinnoh told. (According to a Pokedex entry in Pokemon Diamond.) Arceus created all the Pokemon in the world; this included legendaries as well.
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you can breed almost every Pokemon except legendaires with a ditto
You bet
the fog badge and the rainbow wing
yes you can. but if you have Pokemon soulsilver, the first encounter will be a lugia and vice versa for ho-oh.
in the tin tower but you need rainbow wing in kanto region then you get it from this old guy, the tin tower is near the burnt tower