Forum Moderators: phranque
Aside from looking on line for bargains, I do not believe you are going to find any great discounts on new software for designing, whether it be an editor such as Dreamweaver of Expression Web, to graphics tools like Photoshop. New just is not cheap. However, you may find "used" software on auction sites from people who have upgraded, but you would be one version behind. But depending on what you want to achieve, this may not be a bad thing. In the end, the two basic software programs you should have is a good HTML editor and a good graphics/image editor. If you are going to get involved with things like .asp, asp.net, php, or such, that is a whole other topic :)
Marshall
(1) More of the free software that is available has no direct financial motive. You won't often find that there's a "full", "deluxe", etc. version that you have to pay for, and is really necessary for serious users. The free software for Linux is generally just plain free. Sometimes there's a company involved, but they generally rely on support contracts with companies that are running mission-critical applications on their free software. While much of this software is ported to Windows, there is often something lost in the translation.
(2) Most websites run on Linux. With a Linux box for your desktop, you can run a local test environment that is identical or nearly identical to your hosting environment.
(2a) You will be learning about administrating your server as you use the desktop machine day-to-day.
(2b) There are a number of tools built-in to Linux that make it very easy to remotely administer another Linux machine. I see posts here on WebmasterWorld on almost a daily basis begging for Windows tools to do things that are just built-in to Linux. It's hard to get across to folks just how easy some things are to do with Linux that are difficult to do with Windows.
If you do opt to go this route, and especially if you will be developing software (scripts, etc.) look into the Eclipse development platform. (Yes, it's available for Windows, but... that "lost in the translation" thing...) There are plugins for everything you can imagine, some supporting specific languages, some that add capabilities to anything.
You can do your HTML editing, PHP script writing and testing, Rails development, top-level design, database schema design and testing - just about anything you can imagine - all in one open-source, free platform. (Plugins might be free or commercial, but the vast majority are free.)