I've been using this for a number of years:
http://usa.yamaha.com/products/music-production/interfaces/audiogram/audiogram6/

It can be had for $130 from Amazon...perhaps cheaper if you look around.

It will do mic and instrument input. I use an outboard guitar processor (Zoom G5) but if you use something like amplitube, you should be able to plug you guitar strait into it.

I've had no latency problems at all. It's a great device. I like having knobs to twiddle to quickly make level adjustments.

I was at the same point as you...I had decided that the 80'/90's were long over and it was time to upgrade to modern recording methods.

The audiogram6 has a little brother called the audiogram3, but I don't have any experience with it.