Is there a way to block certain domains that I don't want lurking on my website? For example, I do not want anyone from http://www.example.com to be able to look at my site. Is this possible?
No, but you can block IP addresses using a variety of methods.
Read up about it here: http://en.wikipedia.org/wiki/IP_address_blocking
Yes, there is a way to do this described on the DreamHost wiki at http://wiki.dreamhost.com/Htaccess_file_overview#How_do_I_block_people_coming_from_a_certain_website_or_URL_from_visiting_my_site_or_directory.3F
(see Item 10 in the table of contents for the page)