> What factors should I consider before buying any one of their packages.

Since nobody answered this part:

First, I don't recommend having your web hosting and your domain registration with the same company. It's convenient, and most people will never have a problem with it. But, when someone does have a problem with it, having both hosting and domain registration with the same company can make things harder. If your account is suspended for some reason, you lose access to everything; if your hosting is with a different company and you lose access to the domain name, you can get another domain name up and running with minimal effort and point it to your hosting company. If you have a problem with the hosting, you can keep your domain and set up new hosting. Either way, you have half as much trouble as you'd have if you were using a package deal.

Second, take a very close look at their terms of service. Anybody can have a bad experience with an otherwise good company; terms of service tells you what kind of company you're likely to be dealing with. People have pointed out elsewhere in the thread significant issues with Gandi's terms of service, for example. Another one is NearlyFreeSpeech.net: if you ever have a problem with your NearlyFreeSpeech.net service and you try to get a freelancer like me to help you out with it, that freelancer will find it nearly impossible to work with NFS. You really don't want to hitch your wagon to a business that will make it unnecessarily difficult to work with their support when something has gone wrong.

Third, speaking of support, take a very very close look at what kind of support they offer. Gandi doesn't offer phone support; if you have an urgent problem, you have to rely on email along with all of its crappy other issues and their really slow turnaround time. Look for someone that offers phone support, and before ordering service, go ahead and give the phone support a call and see how difficult it is to reach a live person, what the wait times are like, and how easy it is to understand the tech support person. When you do reach someone, just tell them you waned to see what their support was like before ordering service, they'll understand. (It'll be an easy trouble ticket for them to close.)

Do NOT go with the cheapest possible domain registrar. It's just not worth it. The most expensive registrars are like 15 bucks a year for most common TLDs. Going with the cheapest possible one might get you down around $3 a year, so you're saving a dollar a month to buy yourself a headache in the future. There are a couple of domain registrars to avoid: Network Solutions (because they make transfers extraordinarily difficult and because their web interface is confusing as hell) and Gandi (nonexistent/terrible support and stupid ToS).

Be careful about going with cheap hosting services. Most of them will put you on a shared plan that will guarantee that your site will go down if it ever gets a little bit of traffic. Most of them have really stupid server configurations that can make managing multiple sites really confusing. I've seen some horrifying security policies and responses from several companies (HostGator immediately comes to mind). NearlyFreeSpeech.net is the cheapest possible web hosting, but they don't offer mail hosting and if you ever need support there's a good chance you're out of luck. They specifically do NOT want to have newbies for customers.

GoDaddy has been a big bad problem often in the past, so what I'm about to say makes me a little sick to my stomach, but: they're really not so bad anymore. I've had some excellent experiences with their support over the last year, and they're one of the few companies that offers phone support for everything. Their support people -- most of them, not all of them -- know how to use a commandline and can poke around in server configurations and can talk to you at a level you'll understand. I don't hate having to deal with GoDaddy anymore. That said, do NOT use their mail hosting, they have significant problems with it and nobody there seems to know how to fix it. And nobody's wrong for telling you to stay away from GoDaddy, they've had a well-deserved awful reputation for a long time.

Lastly: if you really don't have much money, and you're just getting started, and you don't need anything very fancy (or controversial, I don't make enough money to put up with the headache of supporting a hate site), contact me at my email address in my profile. I will register a domain for you for free (and make sure you have full access and control of it) and also host it for free, mail service included. I admin my own servers. I don't offer the very fastest support response in the world, but you'll have a phone number you can call. I've done this for a couple of other people on HN and no complaints so far (as far as I know).