I know how to create small data driven websites but want to get an idea on how to convert them to handle large data flow.
The questions are based on a site that would act mostly like stack overflow, craigslist etc where people could post stuff and others reply and would have basic search capabilities based on tags.
Are regular relational databases like SQL server, Oracle etc strong enough to support a lot of data read and writes?
If I have a site hosted on a dedicated single server, how much traffic in general can I expect it to handle?
Are there any general design rules or problems that need to be taken into account when creating mid to large level applications?
With a good caching strategy and well-written SQL statements, any RDBMS should be sufficient.
Short answer is it depends. There's an good discussion on this very topic here.
I would suggest you start by reviewing this post. Just following basic coding practices will help make your code more scalable.