Yeah, if you've never built a frame before, you want to start with steel...unless you're an accomplished welder with ti, al, or another bicycle-appropriate tubing. It'll be cheaper and more forgiving. You could probably hit ebay and scavenge scraps and have the parts you need for a frame for a couple hundred bucks, but it would be pretty low-end material... As far as tools go, the necessities are a good set of files and a hacksaw with a decent blade, an appropriate measuring device, a scratch awl, a vise, some frame blocks, and of course a torch at minimum. With that said, you honestly need to have some idea of what you're getting yourself into, as well as knowing bikes inside and out, and having a good feel for working with your materials of choice.