The leds you linked to are prewired with a resistor for 12V, so they would be very dim on a 5V supply. Also, they take 80 milliamps each, so if you have a bunch of them, you would need a separate power supply, as the 5v suply on the Arduino is good for about 400ma of external power. If you use those 12V leds with built-in rsistor, you'll need a separate power supply adequate to the task... for ten leds, get a 12V 1A supply, for 20 leds, get a 12V 2A supply, etc. The 2N2222 transistor could switch 10 or so of the 80ma leds safely.
Your 12V supply would go to
the + connection of the leds being switched by the transistors, and
the Arduino's balck power jack, which takes a range of voltages and converts it to a stable 5V for the Atmega8.
D