I have been Mt. biking for about 10 years now. I would say to get LX components. Xt is nice (More expensive and usually a little bit lighter) but XTR is just too expensive. I put on about 2000 miles a year and have no problems with the LX stuff. The type of riding I do is basically cross country type stuff. I dont do much of the jumps or stunts. I keep both wheels on the ground. I will do a little downhill type stuff, but only after I have rode up the hill. In the years I have been riding I have broken a chain twice, 1 spoke, and taco'd a wheel when I hit a fence.

As for the type of bike. Well.. My first bike was a Schwinn (Steel Frame). But then I bought a Litespeed Titanium bike back in 96 (hard tail, Rock shok front suspension) and it is probably the last bike I will buy. Ti is a really great! If you can find a used Ti bike I would suggest trying to go with that. Of course, you can only buy what you can afford.

Good luck.
Chris