Yes, you disable the CPU cache in the early startup menu. I'm sure you will find it quickly if you have a look around in the menu. It's hard to miss it.
Before trying to load old games, you should always turn off the CPU cache and set the display options to "original" for the highest chance of getting the game to load. If it still doesn't work, you could try with relokick as a last attempt before giving up the thought of running it from an AGA based Amiga.
It's very difficult to estimate how many old games work on an A1200, but I will try to make a very rough estimation according to my experiences.
50% - not working at all even with relokick
25% - working if booted with disabled CPU cache and graphic options set to "original", or if booted with relokick. However, the game has got graphic glitches or other bugs.
20% - As the 25% category, but without the glitches and bugs. The game runs fine.
5% - The game works fine without glitches even without setting the display options to "original" or using relokick. Only a few old games will work this well from floppy without doing anything else like using relokick.
But again, these numbers are only a very rough estimation and should probably not be taken that seriously.