Here's an article describing some of the differences between C-Corp, S-Corp and LLC. http://www.mynewcompany.com/entity.htm

I'm not an expert either and am approaching this decision with my business partner shortly. Here's what I understand so far.

If you're accepting funding, go with C-Corp since VC's will insist upon it. If you're not accepting funding or angel funding (friends/family) etc. then LLC will be the cheapest and least red tape. VC's prefer C-Corp because it requires you to maintain more paperwork, reports, filings, etc. (though I'm not sure exactly what that entails).

Regarding Delaware, Here's an interesting article on Nevada vs. Delaware. It advocates Nevada for "tax reasons." http://www.val-u-corp.com/whynev.html

Anyhow, I hope that helps. (and that people more knowledgeable in this area respond).