Is the song Timmy and the lords of the underworld available for Rockband2

Yes it is. However, you have to own Rock Band 1 in order to export it into Rock Band 2. Importing almost all Songs from Rock band 1 will cost you only 400 MS Points or 5 Dollars / Euro, dpending on the system you use.

To answer the question precisely: No, Timmy & the Lords of the underworld is not featured in Rock Band 2, but in Rock Band 1.