Can a crystal be replaced by anything that outputs A frequency? does it have to be constant, can it oscillate , like fade from 20 to 16mhz and back?
m = milli (0.001)
M = mega (1000000)
Hz is the correct symbol for Hertz. 16mHz is about 1 cycle per minute.
But you are not alone, I've seen many datasheets getting such things wrong!
With the standard fuse settings the 328 is configured as a crystal oscillator, but it is possible to feed a logic signal into the XTAL1 pin via a 1k resistor, leaving XTAL2 unconnected. Seems to work fine (the oscillator circuit doesn't mind in my experience).