You can have many, many files on one server. However, any file below version 7 must be updated to at least version 7. You can't run .fm5 and .fm7 on the same server.
Maximum of 125 files per server
Just to add in some additional concerns, if any of the existing FileMaker databases relay on external data sources, you'll need to make sure that the single, new FileMaker host can also reach those data sources (i.e.: make sure firewall ports are open, etc.).
Bottom line is that yes, FileMaker Server can host multiple database files. Different LDAP or AD groups can be set tp control access to each, even control what privileges are available to different sets of users within each.
As was previously mentioned, you generally can't run different *versions* of FileMaker server on single host. And honestly, anything still in the .fmp5 format should probably be updated to at least .fmp7.
Appreciate the responses
My plan is to update all the databases to fm14 and then run them off a FileMaker Server 14.