They do brikwars battles all the time on their forums. There are many good reads over there.
And no you can use almost anything (except people) in a brikwars battle.
So by almost anything, you mean pretty much anything I could think of? Even if it isn't Lego or any other type of plastic brick toy. For example, using a Snickers bar for an atomic bomb?
Of course, I am assuming this only applies to brick-based building toys.
Edit: Also to clarify. What I meant by a "limited lego collection" is if you have a small assortment of minifigs, and you want specific ones to be basic, special, or Heroic infantry, but you only have a couple of one or the other? Or if you only have enough bricks to make one of a vehicle. Would your army be limited by that? And if not. Could you substitute minifigs for bricks/miscellaneous items?