Yes, php can read open delete change and close email boxes just like gmail or hotmail can. The library that does this is the imap library. Also if you are planning on creating 50+ email's via php then I would suggest getting a managed vps as you might get into a few complications with your web host about recourse usage and spam. As for creating inboxes you can use the imap_createmailbox() function.
So I assume it is @yoursite.com. This would mean you will need to use the imap library to create their mailboxes and you can provide them with essential information via the echo function. Let me know if you have any troubles using the imap library.