Yes, and yes.
You don’t work with the original. you use a new layer, or actually, a second instance of the same clip. You apply the effect to the entire second instance and then use a garbage matte to just show the area you wanted to modify. Garbage mattes can be keyframed.
If the Premiere Pro 1.5 16-point Garbage Matte is not enough, then you have a lot more work to do and should be using After Effects, which is designed to deal with much more complicated masks.
Steven
Adobe Premiere Pro 1.5 / After Effects 6.5 Pro https://www.stevengotz.com
Learning Adobe Premiere Pro 1.5 https://www.lynda.com
Contributing Writer, PeachPit Press, Visual QuickPro Guide, Premiere Pro 1.5