Correct. In the old days of linear power supplies, transformers had to be designed based on the line frequency it was intended to be used for. The lower the frequency, the more 'iron' the transformer needs. That's why you'll often find 400Hz power being used in aviation applications in order to save weight on transformer size. Conversely, radios designed in the days when parts of Canada used 25Hz power required transformers which were
massive. More about power line frequency can be found
here.
Pretty much, yeah. I'm not sure whether the N64 power brick uses voltage regulators or not, but a 240V input power supply running on 120V will output roughly half of the intended voltage. The LED used as the power indicator doesn't require much current in order to light, which is why it'd glow even with half voltage present, but the rest of the circuitry is more power-hungry, so it wouldn't be able to do much at that input level.
-Adam