Any glycol-based fluid will work in your system. That means DOT3, DOT4, and DOT5.1 (or DOT4+ in some cases). DOT5 is silicone-based and will not play nice with the existing fluid.
Yes, but moving to DOT 4 is not always an improvement over DOT 3. There is a trade off because the Borate esters in DOT 4 are more hygroscopic and will need more frequent replacement.