I've rooted my Android and jailbroken my iPad, and I believe I can explain how they are similar and different.
Does the Android have an app market like cydia?
Apps that require a rooted phone are available in the normal Android Market. Cydia is a third party app store out of necessity; jailbroken apps are not allowed in the Apple App Store. There is no such restriction by Google, so you can just use the market as usual. Another feature of Android is that you can enable your phone to accept 3rd-party apps. These apps don't need to be from a 3rd party app-store; some developers create their own web site and distribute their app via that site independently from the official Market. Several popular root apps are obtained in this way.
Can all Andriod phones be rooted (jailbroken in iphone terms right?)?
I haven't heard of any Android that couldn't be rooted. However there is a very important distinction between rooting and jailbreaking. What they have in common is that after the hack, you have superuser access to the filesystem. The Android rooting procedure goes a step further by also unlocking the bootloader so that you can actually replace the operating system with custom/modified ones. Because the kernel and Android are open source, it's much easier to customize the OS in a meaningful way.
Furthermore, Android uses the linux filesystem in a very straightforward way, whereas iOS intentionally obfuscates how it utilizes its filesystem, so that even if you are jailbroken and can log in as root, you can't do much to the filesystem to affect iOS. For example, on your iDevice, try managing your music and/or videos from the filesystem, or try to uninstall an app via the filesystem. It's designed to be near impossible. Likewise, jailbreaking an iDevice still doesn't give you any access to hardware components. This is why you don't have profile/scheduler type apps on the App Store or Cydia.
I should note that Motorola isn't too fond of users having free reign over its hardware, so it has encrypted the bootloaders of its phones. So far, the encryption has foiled hackers' attempts to unlock it. So rooting potential on Motorola phones is reduced.
After rooting the phone could you re-flash back to the stock firmware for warranty purposes? (like apple once you jailbreak it voids your warrenty but you could always flash back to the stock firmware)
Yes, it is possible to flash back to unrooted, stock condition.
If an andriod phone like the htc sensation running on 2.3 (gingerbread?) will htc release newer verisons of andriod when it comes out? like 3.X series (ice Cream?)
Yes, to a certain extent. A given phone is not supported indefinitely, so if the phone is aging, it's possible that the manufacturer stops releasing updates for it. If you are rooted, this is less of an issue, since the homebrew community for a popular phone will likely develop a custom OS running on the latest version. Of course, eventually, even the community will lose interest in the phone, but typically after you've already upgraded, so...
