GTA2 can be played on the internet but you need close to LAN conditions for it to run at a playable speed. I used to play it all the time with a broadband friend that lives in the same country as me. It is too slow against people in far away countries even if both players have broadband.
There was also no game finder built in so you had to manually get your opponents IP address and paste it in.
I doubt much has changed in this free version, they probably just recompiled with a newer directx. The download hasn't been working for a few days, the servers appear to be down.