Can we add a HTML link in the Acceptance Text area to our Terms and Conditions page?

Unfortunately the acceptance text area can not take html, only text. You could add linked text information in the long description area of the product page though, or create a terms and conditions page and make it a link in menu 1 (top navigation area) so that it can be seen on all internal pages. You could then simply have the acceptance text read "I agree to the terms and conditions" and have them check a box.