Pretty much all small artists that start off nowhere just work a TON...and never give up no matter how much money/comfort/time they must sacrifice to pursue their passion.  Eventually, if you're actually talented, you'll make your way up there and start to actually make money off your music.  It's a hard, long process--but can be done with time, effort, and talent.

Also...be honest with yourself.  Don't tell yourself "Yeah cool this song is done" when you know there are some bits that need reworking.  Be modest with regard to your own musical talent.  It's easy to come off as really arrogant with regard to music as there are many out there that would love to be talented musically but think they can't or don't have the motivation, so try not to come off as an asshole.  From personal experience from the opposite end (I haven't played a chipmusic show BUT I have played metal shows) be extravagant as hell...and I don't mean shout: "OH SHIT LOOK AT ME I'M THE TITS!", I mean get really into it, dance, tell your audience to do things like stand up or stomp.  Possibly get a small gimmick somewhere in there...just so the audience can AT LEAST walk away from the concert thinking there was one thing to did that was clever/cool/the cat's pajamas.  Get all those bitches some free shit, bitches love free shit.  Jump on the opportunity if you meet ANYONE that seems interested in your music...don't treat them like an afterthought.  Meet people on a personal level rather than a "I want more people to show up to my gig" level.

The only problem with this advice is that people might think they have to rush the process. Don't rush it. Don't ever rush it. Accept the fact that it can take years to build up a real following. You have to play lots of shows and make lots of great songs before people will really love you.

Make lots and lots of music. Appreciate your audience. Make lots of friends. Make friends with the people who listen to your music.

Edit: Go about this process like you're going to die tommorow. Think of the whole process on the simplest level. Not for fame, just for the experience. Ok i'm being dramatic now.

I think my school has a couple of them. Once we get the sole Mac at school up and running for recording in the studio..

Adding to the mic post, on the dynamic side, you can't go wrong with a Shure SM58. It's a great workhorse.

THIS THIS THIS all the way.

For live venues, change your name to "FREE BEER."

If only I had some money... haha

Yeah, which software you use isn't too big of a deal, as long as it isn't Audacity or something, the mic is what's going to make the biggest difference

I'm using GarageBand currently, seems pretty nice.

Forget about hardware effects, drop $100 or so on a decent condensor mic, it'll be the best recording purchase you ever made, then just record into some free software, Reaper or something.

easy, get a fake ID

Dam you I still want one of those. REPRINT!!! REPRINT!!!

ONTOPIC: There really isn't anything wrong with using software to get your effects in the final recording. Unless it's a major effect that you want to be using live, don't worry about it just now. I personally prefer hardware just because HEY IT'S RIGHT THERE, but it doesn't actually make that much of a difference for recording. Plus, if you really wanted to, you could do some amazing (and by amazing I mean OH GOD NO.) setup where you run in to computer effects and then out to tape recorder.

I meant that instead of using software and its built in effects to record, if I actually had some hardware then I could make similar quality recordings on my tape recorder.
Nothing about my music, haha.