Well, I've only done the trail one time. We camped at Loon Lake the night before starting the trail, as it is a long winding drive from Reno. There's really nice established campsites there. You could get a motel in Placerville, but that's probably an hour and a half from the trailhead. It's an hour from highway 50 to Loon Lake (the trail head) because it's 30 miles of VERY slow, winding road. We'd probably want to be hitting the trail no later than about 9 A.M., particularly if we had a reasonably large group (i.e. more than 5 trucks). We went with 9 trucks, if I remember right, and it took us nearly all day to go from Loon Lake to the mid-way point: Buck Island Lake. We had a nice pace, though, and did some nice sight seeing along the way.
Buck Island Lake is an extraordinarily nice place to camp. There's GIANT flat slabs of granite for camping on, which is nice because it's not real dusty or lumpy. There are bears up there, and they got one guy's food that was sitting in the back of his Jeep while we were sleeping (or rather, waking and having to deal with a mother bear and her 2 cubs.

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The second day has more miles, and starts off a bit more challenging than the first day. However, the last 6 miles of the trip (from the scenic overlook above Cadillac Hill to the trail end at Lake Tahoe) is just a terribly bumpy/uncomfortable ride, but it's not technical. And, the faster you go w/ tires at 10 PSI, the more comfortable the drive is!
You'd probably want to get a place to stay in South Lake Tahoe that night. So, the shortest trip you're looking at is 3 nights, if you want to do it comfortably. I'm planning to go with another friend and make a longer trip out of it - 2 nights at Buck Island Lake. I want to do some hiking up there.
As to breathing, it is obviously super clean nice air up there, but you're talking about spending most of your time between 6 and 7 thousand feet elevation, if I remember right. It's certainly not lower than 5000 feet.
I can't recommend the Rubicon Trial enough. It is SO stunning. The four wheeling is great, with lots of nice technical stuff, but nothing that requires a buggy. I took my Blazer through there with only a couple scratches, so it can be done pretty easily. Rocksliders, however, are an absolute MUST HAVE.