I think it would be better to split up according to skills. What I mean is that we shouldn't have three lead guitarists in one group, three rhythm players in another, and so forth. We should try to split up so each group has a rhythm player, a lead player, and someone who knows about recording and mixing.
By the way, I have webspace. It'll just be a matter of getting it set up for anonymous ftp access.
James, you mentioned that you'd be able to build a page for this. What are your web-building skills? PHP? Graphic design?