Hi Rain-
I agree with you and Dave. Bass traps are a great place to start. Remember that bass traps will absorb higher frequencies in addition to lower ones, so you'll gain quite a bit by starting with them.
A really solid investment is Rod Gervais' book:
Home Recording Studio: Build it Like the Pros . It super detailed, and you may not find all of it useful, but there are some great pointers in the book. It made a huge difference for me.
Something else that I found helpful was drawing out my room using Google Sketchup and posting the ideas on GearSlutz in the "Studio Building/Acoustics" forum. I got some feedback from people that was helpful. It also allowed me to pre-think the space before I got started.
Last, even though there are many places that sell the pre-assembled panels, etc. they all tend to be over-priced IMHO. You're on the right track looking for the raw materials and doing it yourself. You'll save a ton and get results that are tailored to your room.
Depending on how much effort you want to put into the room, there are free applications that will assist you with calculating the materials you'll need for your space. Real Traps (realtraps.com) has some free downloads that can assist. Also, I grabbed an awesome set of tools for an iPhone that give you a SPL meter, tone generator, RTA and other utilities.
Audio Tools Last, Dave (bitflipper) and others have posted a lot of useful stuff on this forum about room treatment. We used to have a lot more folks asking about gear and stuff, and Dave used to tell people to start by treating their rooms. He was soooo correct. It's probably the single best thing to spend money on that makes a noticeable difference.
Good Luck!
Oh...and last, I bought a bunch of mineral wool (Roxul) for a good price from:
Superior Plus Contruction Products Corp. International Technifab - SPI 801.974.7684