You'll need a gamepad with two analog sticks to use Freestyle.
You don't have to use Freestyle to play NBA Live 2003, but it does make things considerably easier (raising arms on defense, having control over the crossover you execute). It's not vital to play the game, but it really is a lot more enjoyable if you do use it.
As for the types of gamepads...check out
this thread.
As usual, I'll plug the Thrustmaster Firestorm Dual Analog. The advance of this pad is that you can switch between digital and analog mode by pressing a button on the gamepad. This means you can use the right analog stick for freestyle and the D-Pad for movement, instead of using the left-stick for movement. However, you won't be able to use Quick Plays if you do this.