The sound diference is very slight and most people can't tell the difference. Also, as these modes are entirely for fun and not competitive at all, I try my best to make them all balanced for both sides, removing the restriction for the weapons and their upgrades to not be team dependant. This means people wont get an advantage by choosing one team over the other and it comes down to skill and such.

You can choose between two sniper rifles? I think that only one rifle, depending on the side would be better idea - Insurgents have only Mosin, Security have only M40. That's because if you heard a shot, you would tell who shoot this - enemy or friendly.

It is a custom theater. Basically, server admins can download this and place it in "insurgency/scripts/theaters/" (creating the scripts and theaters folders if they don't exist) and enter "mp_theater_override insanz_boltaction_only_v2" in the server.cfg ...
Then restarting the server means this set up is running on there for anyone who joins. Best used for events and not 24/7. If anyone has trouble joining a server due to "enforcing consistency" when sv_consistency is set to 1, this will download the updated version and allow them to join.

If you want to play this, Insurgnecy ANZ (www.insurgencyanz.com) runs events and the next will contain a number of custom theaters, including this one. Check us out!

what servers run this?

Mk4 is the Security varient for a 7x scope. So yes

In 3rd variant Mk4 allowed too?