Really there is only one iPhone, just different versions of that same phone. The cheapest route to got would be to get an 8gig 2G but that is fairly outdated. If it were me I would get a 16gig 3G or 3Gs the extra coin is worth it for the 3GS IMHO. Quick question though what carrier are you on? That makes a real difference as well.
Like the others have said, you can check with your carrier and see if they offer the iPhone. You can probably get it for far less than new subscribers. That's what happens with my local carrier so I assume the scheme will be the same for yours.