I use cypress and it is really nice.
I buy a 3 cubic foot bag for about $4.
You need to make sure it is UNTREATED.
I get it from a local Agway ( I am not sure if this is a national chain or not?). I would be really careful going to a Home Depot or Lowes. Agway is a smaller garden/farmers supply store and they have more personlized service. The lady there was certain it was untreated and told me a local zoo buys their cypress from them also.
I layer it from about 3 inches deep on the warm end to 3/4 inch on the cooler side. I will occasionally wet it down really good on the shallow end and let it soak underneath the deep end from there, this way the deeper side where they bask will stay dry on top, and the humidity will hold up real good. I then let it dry out for a couple weeks until its totally dry and do the process over. I like to think its more natural, like after a big rain in the wild.
You dont need a basking light. Underneath heat only woks. I yse a basking light in my display tank, but in my rack I only use FlexWatt and no spot. The spotlight dries things out much more quickly. Also, alot of people reccomend like 60 or 70% humidity. Alot of other people say you should have the humidity alot lower. I keep the humidity on the lower side, like 50 - 60%. When I soak the cypress down the humidity will spike for a few days then I let the setup completely dry out and do it over. I think high humidity on a constant basis leads to upper respitory infections. The tub becomes like a big petry dish.
Good luck and ask alot of questions.
Also, go with the cypress, its really natural looking and nice.