First, by your screen name I'm guessing you are a TOOL fan?    
   
 
   OK, two recommendations. 
     1)     Inexpensive, but nice sound?  A wired Shure PG58.  They go for around $60.oo and soud VERY nice for the money.  You want to pay less?  Shure was private labeling for Radio Shack for awhile.  If you can find their model# RS-230, it's the same mic at about $40.
   You could even get a PG48.  Also sounds great, and in some rooms even better than an SM58!  Around $40
    2)  Though KaraFun is a cool bit of software, I STRONGLY recommend that you  buy a player, and possibly just use your PC to mix.
        A PC's disc drive is not all thet durable, and constant or heavy use will evenually break it.