I have a pinched nerve in lower back that causes pain to my right hip. is it appropriate for me to play basketball or must rest it? thanks!

Most likely, rest: Of course your treating Doctor who knows you and has the imaging reports that can be clinically correlated to your physical exam would be able tell you the best type of activity you can do. Me, over the computer would say that conservatively, I would rest the area, until you get some relief of pain, then follow-up with your Dr. to get an official answer as to a "return to Physical activities."

Varies: In general, you would want to restrict all activities that make the pain worse. Playing basketball would be a fairly high risk activity to potentially aggravate it.

Need rest: I would suggest talking a few weeks off a high intensity exercise like basketball.