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Hello Whoa9090 and welcome to the XOOPS forum!

I am unsure about what "behind the scenes" means? Do you mean in a sub-directory of the root? If so YES, I have done this and it works perfectly successfully. I have installed several modules and they also operate fine.
XOOPS is a stand-alone CMS, so ou can't really integrate it in anything else except by linking to pages.
I have also installed XOOPS in the same database as other scripts, NO problems at all. Providing the tables are unique, there will be no conflicts if you share a database. If you intend to use XOOPS as a primary website, it is advisable to install it with a dedicated database, simply because, it is easier to maintain and administrate
Come back again if this doesn't hit the mark!
Richard