For audio, you might want to look into the Zoom H2. It’s a decent quality recorder (with built-in mic) that can be bought fairly inexpensively.

As for cameras–I wouldn’t sneer too fast at older stuff, even though they may have the inconvenience of conversion. The lower priced models don’t have audio inputs–which makes it virtually impossible to get an acceptable audio input. Remember–on the net, high video resolution isn’t as critical as good audio. I get good results with our old early-model JVC digital video cam–and just bear with converting the mini-tapes. If you trawl Craigslist, good older models can be found. I also use video in a flip–the sound isn’t great, so I generally don’t use it for sound.

When you can afford it, get a good condenser mic. They are costly–but will make a huge quality difference. Lastly, if you are going to film indoors, consider getting some lighting and a backdrop. A couple of yards of remnant decorator fabric (nothing too busy, remember) tacked to the wall can give the impression of a real set–and you can improvise a lighting setup with clamp lamps from the hardware store (you can get basics by searching the web for tutorials).

Best of luck!