Depending on your kind of traveling and whether you want to get out of cities as well, I think that`s an ok time frame to fit most things in (but remember things will probably change once you start traveling!) I tend to work on a ballpark estimate of 3-4 days per major city, 1-3 days for minor ones and half-one day between each one for travel (especially by the time you`ve packed up, traveled, oriented yourself etc it often adds up to a whole day). But then - remember I tend to spend around 6 weeks in a country and like to take my time so you may find yourself moving faster.
Unfortunately i`ve only been to Prague and Paris out of your proposed list so can`t give you specific advice on much, but feel free to ask anything about those two. Once again, I didn`t use a Eurail pass, but I did buy a French rail pass for the 6 weeks I was there. The benefit is your travel is pretty much all paid for then and you can just turn up and jump on whichever train you want (keeps things nice and flexible) The bad thing is I didn`t manage to break even on the cost of the pass (although I came damn close) and some countries are better for rail than others (not that you`re going there, but Italy and Spain are better just to buy individual tickets, maybe even stick to bus)
Cost: LP should give you a good idea of a daily budget for each country. Add a little more for spending money and if you have enough saved, you ought to be able to afford your trip. There are heaps of tightass things you can do on tour to stretch your money while still having the time of your life (let me know if you want me to elaborate).
Preparation: Sure, you can prepare till the cows come home but you`re always going to making it up on the spot to some degree. Do the best prep you can then realise your learning curve will be huge (in a wonderful way) while you`re traveling. That`s the cool part about it all. Plus there`s two of you so if you make good traveling companions that will be a strength.
Age: If you`re under 18 some things will be difficult mainly cos you`re still counted as a minor. Apart from that - you`re never too young

Remember to purchase an ISIC card before you go though (there`s a youth option if you`re not a student anymore) and utilise all the discounts under 26ers can get.
Some initial thoughts though:
-Pre book Paris or consider couch surfing - I found it hard to find hostel accomodation there at short notice during May-June so I can only imagine it will be worse when you`re there. The Marie De Clichy HI hostel was generally able to accomodate me but it`s a 30min metro ride out of the city which doesn`t suit everyone. In the end I stayed with a guy in Montmatre that I met, which was much more fun and relaxing.
- Definitely use the tourist bureaus and talk to fellow travellers - if you`ve only got Europe on a Shoestring you`ll miss out on all sorts of interesting bits of knowledge and opportunities purely because they haven`t had the space to fit it all in.
-Always arrive with a little bit of spare cash (my ATM card didn`t work in France and I was short on money for most of my trip cos I couldn`t pull any out - pointless stress). Have a phone card so you can call home if it all goes belly up (if only to have a whinge to them then continue your travels!) Save all scraps of paper so you can hand your email address out to all the cool people you`ll meet

oh - feel free to ask more questions - your topic is huge so the more things you ask, the better we can help you with advice. But I am traveling at the moment so I may not always be able to get back to you as quickly as I`d like!