Ok... here we go...
1. How do I get a job without having experience (everyone wants experience)?
Yeah, this is the ultimate Catch-22. Fortunately, you studied computers in school, so you have that added advantage. Is your degree actually in something computer-related, or was it a minor? As far as experience, one option to start building a history would be to volunteer your time working with computers. I understand that income is a consideration, but this would at least allow you to add some experience to your resume.
Another option might be to go back to the industry that you were working in, but instead of applying for the work you were doing, apply for an entry level IT position. Companies might be comforted enough by your knowledge of their industry to give you a little bit of a break on the experience front, especially since you studied computers in school.
2. What is it like working in IT support (boring? satisfying? fun? etc...)?
Just like any other job, it's all of those things and more. Some days are a real drag, some are a lot of fun. Some and intellectually challenging, some are boring. I can tell you that I find helping people with their issues pretty satisfying, especially when I'm able to do something unexpected and helpful for them (such as automating a tedious process). In all, I would say that if you enjoy interacting with and helping people, working in IT should be a very enjoyable career path for you.
3. What is the career progression (where do I go after: 1st line, 2nd line, 3rd line, manager)? Also is it possible to move into other roles (like programmer)?
There are several unique paths in the computer world. Technician would be one, administrator another, programmer a third. There is some overlap between a few, but in all they tend to be exclusive, skills-wise.
It can be somewhat broken down like this: producers of technology and utilizers (didn't like the word "consumers") of technology. Producers would be programmers, hardware architectures, chip manufacturers, etc. Utilizers would be hardware repair techs, IT helpdesk support people, server administrators, etc. The first thing you'd want to do is decide which of these two directions you're most interested in.
After that, career paths can vary, but typically for a "producer", it would go something like junior developer to senior developer to team leader to software architect. For the "utilizer" you would follow something like helpdesk technician to helpdesk leader to system analyst to system administrator. Also on the "utilizer" side of things lies network design and engineering.
4. Is it worth paying for a Microsoft Certified Qualification (if so which one?)?
Well... it's tough for me to answer this question without offending anyone. First, I want to say that I'm sure there are plenty of qualified MCSE's and MCSA's out there. It's just that I've never met any of you.
Personally, I feel that there are many, many other certifications that are far more worth your time than the Microsoft certifications. A+, Network+, Cisco, just to name a few. The Microsoft certs tend to be narrow-minded (obviously focusing on Microsoft products), while the others are more broad.
My experience on certifications is this: the employer will typically tell you what they're looking for, and a lot of times they'll pay for you to get certified. If I were you, I'd start with A+ on your own, and see how far that gets you employment-wise. I'd also state in any interviews that you do that you're willing to take on any certification they require.
5. Is there anything else I can do to improve my chances?
Be open to anything. You're looking for a foot in the door, and any crappy little IT helpdesk job is a line on your resume. Remember that we IT folk do hop jobs, so you're really just looking for a starter position to tell your next employer about.
Good luck! Keep us posted on your progress!