'Breadbin' Commodore 64 Ultimate: BASIC Beige

Yes, there are still new Commodore 64 games being made, especially on itch.io, so you would not be limited to only old games. Many developers release new C64 titles there in digital formats that the Commodore 64 Ultimate can run from USB. You can also play original C64 games. Original cartridges plug into the cartridge slot on the back, but the C64U should be turned off before inserting or removing them. Original floppy disks require a real Commodore disk drive, such as a 1541, connected to the IEC serial port. Original cassette games require a Commodore Datassette. The easiest option is usually digital games. The C64U supports formats such as .d64, .d81, .crt, .tap, and .prg. You copy the game to a USB drive, plug it into the C64U, open the Disk File Browser, select the game, and run it. So you can play the original library and keep adding newer games from places such as itch.io.

OS: No. This runs the original Commodore 64 BASIC operating system. It is fully compatible with all software and hardware made for the C64 since 1982. Word Processor: Yes. This can run GEOS which is a full office suite made to run on the C64. Disclaimer: The modern public is used to decades of advancements in office suites, so temper your expectations to what would've been possible in the 1980s. However, the new C64 can operate at much higher speeds than the original which will certainly have a positive effect compared to what was possible in the 1980s. However, expect a distraction-free and "pure" computing experience unlike pretty much any modern operating system. I have 2x of this same device, but in the "Founder's Edition" variant.

The Commodore 64 Ultimate includes a USB “Cassette” with more than 100 total items, including over 40 classic and newer C64 games, plus demos, music, GEOS, and tools. The game lineup includes titles such as Bomberland, The Way of the Exploding Fist, Hunchback, C64anabalt, Super Bread Box, LuftrauserZ, Space Moguls, Metal Warrior 4, Lykia: The Lost Island, Tiger Claw, Outrage, YOOMP! 64, Robot Jet Action, Timo’s Castle, The Bear Essentials, Space Station 23, Acid Runner, Tiny Harvest, Jupiter Fracture, and many others. It also has CommoServe built into the main menu. Once the C64U is connected through Wi-Fi or Ethernet, CommoServe lets you search for and run thousands of additional archived C64 games directly on the computer without transferring them from a PC. You can also add newer C64 games from itch.io using a USB drive.