I have just invested into a few low budget microphones to find something that gives some real quality sound: A $20 lavalier mic from Radio Shack, the Audio-Technica ATR35s, a video SIMA MZM-1 and a VERY cheap microphone that came with my HP computer.
I have some audio for you to listen to and you can hear the difference.
One of the things that bothered me was that any POWERED microphones recorded much lower levels, although better sound, than the unpowered mics. Also, with the unpowered mics I could use a splitter and get mutiple mics working at once to record in stero.
I took the DS-2 outside when I took my dogs for a walk last night and talked to the neighbor. The first 37 seconds of the audio from the link below was from the onboard stereo mics, and the next few seconds were with the cheapo Radio Shack lavalier held about waist level with my finger just casually looped into my belt. Here is the audio--
From my tests, I can say almost definitely that you could get some amazing audio recording for Under $200. I was able to edit the WMA files to .mp3 files quickly in Propaganda software.