First recommendation; go to fry's- they have nice madcatz handheld racing wheels for $10. The wheels list for like $29 on madcatz's web page. They even have feedback (bumps, not wheel pressure feedback tho)
Second Redommendation, start with the mazda miata. This car with a stage 1 turbo and a few other mods can make 270 HP, and with proper tires and setup you can go race on the super speedway in the beginners series championship and win $10k a race.
From the miata, I went to an RUF 3400s (Porsche Boxster), which can make up to 400HP NA, and 500HP if you turbo it, and it drives waaaaay sweet!
Hope y'all have as much fun as I am!
