How can you?
I've been using the below method from the (now suspended) Xmodulo site to remote into my entire Raspberry Pi desktop from any Ubuntu machine. Works with my original RPi, RPi2 and RPi3. Of course you have to mod sshd_config to allow X11 forwarding on the remote machine (I'd say client/host, but I believe they are different in X11 from other uses and I may confuse myself). Mind the spaces -- they break this procedure frequently when I can't type.
You then have the entire desktop and can run the machine as if physically connected. I switch to Ubuntu using CTRL+ALT+F7, then back to RPi with CTRL+ALT+F2. YMMV. A quirk: You must physically release CTRL+ALT before hitting another function key when switching back and forth.
Original link: http://xmodulo.com/2013/12/remote-control-raspberry-pi.html
Original work attributed to: Kristophorus Hadiono. The referenced pictures are, sadly, lost.
============== 8< ==============
Method #3: X11 Forwarding for Desktop over SSH
With X11+SSH forwarding, you can actually run the entire desktop of Raspberry Pi remotely, not just standalone GUI applications.
Here I will show how to run the remote RPi desktop in the second virtual terminal (i.e., virtual terminal 8) via X11 forwarding. Your Linux desktop is running by default on the first virtual terminal, which is virtual terminal #7. Follow instructions below to get your RPi desktop to show up in your second virtual terminal.
Open your konsole or terminal, and change to root user.
$ sudo su
Type the command below, which will activate xinit in virtual terminal 8. Note that you will be automatically switched to virtual terminal 8. You can switch back to the original virtual terminal 7 by pressing CTRL+ALT+F7.
# xinit -- :1 &
After switching to virtual terminal 8, execute the following command to launch the RPi desktop remotely. Type pi user password when asked (see picture below).
# DISPLAY=:1 ssh -X pi@192.168.2.5 lxsession
You will bring to your new virtual terminal 8 the remote RPi desktop, as well as a small terminal launched from your active virtual terminal 7 (see picture below).
Remember, do NOT close that terminal. Otherwise, your RPi desktop will close immediately.
You can move between first and second virtual terminals by pressing CTRL+ALT+F7 or CTRL+ALT+F8.
To close your remote RPi desktop over X11+SSH, you can either close a small terminal seen in your active virtual terminal 8 (see picture above), or kill su session running in your virtual terminal 7.
Best Answer
As stated by sarnold, XDMCP should be what you are looking for. However, if "I want my computer to be a 'dumb terminal' " is not a hard requirement, I would encourage you to use NX (implemented, e.g., by FreeNX) instead. It is an improved version of X forwarding over SSH, but it will require a desktop environment on your laptop to run its GUI. However, it has several advantages, mainly bandwidth usage.
That brings us to your second questioN: X forwarding should work fine on a 100 MBit network. Compression will most likely be unnecessary. However, X does take some bandwidth, especially when you have animated content on your screen. So in order to free up your network for other transfers, the low bandwidth needed by NX would help.
Wrt your third question: Well, Arch has a rolling release principle, meaning that there is a continuous stream of updates. It's nice for older machines because it can be tailored so it works perfectly with your machine, and there's good documentation for that. You can definitely make it very slim and efficient, and that will be easier than "trimming down" a SuSE / Fedora / CentOS/... installation. However, if you really only need a dumb terminal, a rolling release system is perhaps less practical than just using a simple Debian installation or something similar, which you can keep on "stable" with minimal updates for a long time.