Muscles rebuild as soon as they are forced to work beyond their normal range/strength. So eg. if you do a good weights session and the next day feel sore (known as DOMS - Delayed Onset Muscle Soreness) it means your muscle fibres have been stretched/damaged (in a good way) and they are rebuiding/repairing so they are prepared for next time they have to deal with the same stresses. So really, as long as you're doing regular resistance training, then your muscles are constantly rebuilding themselves to be stronger and/or bigger depending on how heavy/intense your sessions are. This is why its important to consume enough protein as this is the building blocks of muscle. DOnt have enough in your diet and then your body starts to break down your muscle to cope with your requirements. Obviously this is not a good thing as we all know the more muscle we have the higher our metabolism as it is an active tissue. Fat is not metabolically active and it requires no energy to exist.
As for how long it takes to build, I've heard numbers around the half a kilo per week but that is for serious weight trainers and their diet would have to be spot on. Obviously its harder for women and for ectomorphs to build muscle size however anyone can build strength quite easily if they put in some hard work.
To answer your other question, my opinion is that if you have done weights previously then it wont take as quite as long to get back to your previous strength level compared to if you were a beginner. Our bodies do have quite a good memory for these things. However, as Kim said you must start off very slowly and only increase if your technique is perfect and you feel ready to do so. The first week or so you may be sore but your body will get used to it quite quickly. Remember, soreness is a good thing, pain is not! If you feel pain, stop what you're doing and seek medical advice.
That's my two cents worth, I've babbled again havent I?