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1. The easiest approach would be to use the installed AS 3.8 with the Axim x51v. Will this work? If no, why ...?
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No, because Microsoft made 4.x Activesync a requirement for WM5. They took out the sync by wifi, database sync and font conversion.
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2. Will installing AS 4.1 on the laptop overwrite AS 3.8 or will AS 4.1 be installed as a separate application?
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Not sure, it should overwrite, but I remember reading to uninstall old version before installing new one.
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3. Should AS 3.8 be uninstalled from the laptop before installing AS 4.1?
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I believe so. That is what I have done.
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4. If AS 4.1 is installed, will the Axim X5 work with this version?
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Yes, it will work, with the changes listed in answer to number 1. (I also have an X5)
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5. Can I assume that both Axims will be able to sync with the laptop as long as each Axim has a different device name?
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Yes, you are correct.