the reason the firepod's are cheap on e-bay is because they've got a massive habit of going wrong. hence the dreadful re-sale value.
you really need to establish a budget and do some research. at entry level M-Audio's stuff isn't tooooo bad. if you're planning to record straight into your soundcard look for a soundcard with good pre-amps etc. read some reviews. get up to speed on the terminology and what you're looking for.
DAW wise - find a copy of cubase and get to know it. If you're happy using reason then it should make some sense. it'll allow you to record & edit audio and as has already been mentioned you can re-wire reason to cubase and use cubase to mix down your project.
If your soundcard has instrument inputs you can d/i (plug yer mates guitar) straight into your soundcard, record the guitar and then you can use something like Native Instrument Guitar Rig to get a nice guitar tone.
mic wise. this depends on your budget really. read up on microphones.....sound on sound magazines website is a mine of information. it's choc full of detailed reviews, guides etc..
basically a dynamic mic like a shure sm is robust, affordable and you'll be able to record a host of different instruments. it won't however sound too detailed - vocals & acoustic guitar would normally be recorded with a condenser mic - have a look at the basic models by rode if you're wanting to make higher quality vocal recordings.
the best advice I can give is to read up on these things. don't take random advice from people on forums. if you're on a limited budget the best thing you can do is make an informed choice and get the best you can for the money.