You can get a salvage title. Don't know the details, but check out Texas DOT website.
As far as insurance goes, state only requires you to carry liability. If you have other vehicles on your policy you should be able to get a discount for limited use.
It should pass inspection, but since it's OBD-I they will stick a 'sniffer' up the tail pipe and check exhaust. (First thing inspection stations want to see is proof of insurance)