A six-month contract-to-hire term is way off the market. I'm biased (I think all temp-to-perm arrangements are so far off the market that they're essentially exploitative), but my observation says "weeks" is a more typical term.
I can understand a very shaky company not wanting to assume payroll obligations that they can't meet, and respect the notion that your contacting offer is made more in a spirit of candor than in hedging, but it should be possible to get your vesting clock starting now.
Also, the 'loumf comment is golden. I'd add that you should plan on engaging an accountant, and factor that into your costs. Also, are you planning on running out your COBRA during this period? Your health insurance costs are going to go up sharply.
You have to pay your end of FICA (the employer portion -- 6-7%) -- so factor that (at least) into your idea of your salary. Also, medical insurance -- since your job is changing, you are eligible to get insurance from the exchanges (I think) -- certainly from an agent.
Taxes aren't being withheld, so you have to file estimated tax every quarter.
What other kind of things do you want to know?
As a contractor, you get the full amount with no taxes withheld (but you still owe tax). Pick a reasonable number that you think you owe the government and make an estimated tax payment (to your state too, if you live in a state with income tax).
It's simple paperwork, not a full tax filing. You can do it online.
So take your target salary, add the costs of cell phone, computer, laptop, etc plus all your routine costs (internet access, cell phone, business phone, etc) plus all benefits (time off, sick pay, life insurance, health insurance, disability insurance, retirement plan contributions, etc) plus your downtime costs (it is highly unlikely you will contract 40 hours a week every week for the whole year, so you will have unbillable time while you search out your next gig).
You will have to do the math for yourself, but it probably comes to an additional 50-100% of your current salary rate. This calculator is a good start: http://www.rakkar.org/ContractPayCalculator.html
You should talk to an employment lawyer.
1. Thought it would last longer than one month. I assumed (still do) that they would realise I was faking it and take it all away. So I paid extra for temporary access to things (rented a car not bought). A year later I still was. Stupid. Assume you are now a contractor for five years. You probably will be these don't sound like people to stick with.
2. Think of yourself as a business. Not a contractor - a business who needs to market and build a "sales pipeline". Who are you going to work for in six months time? doing what? How will you find them in the next three months and persuade them to wait?
3. taxes. Oh shit taxes. Get a accountant and do not leave their office on the first day until you have written a spreadsheet and calculated your own basic tax return. know this stuff inside out. You are now running 4 tabs on a spreadsheet and carrying over from one to the other:
Business Income > Business Outgoings > Home Income > Home outgoings. Make a spreadsheet like that today. Fill it in.
4. Blog - it's probably the best middle path for marketing yourself. But choose your story, your unique take on things. Are you techie through and through? A Brogrammer? An outdoorsy hiker, a Beethoven lover? What is your (oh god) tribe? Talk to that tribe - somewhere there is a hiring manager who is also a member of your tribe. Probably quite a few - talk to her through your blog.
5. Never ever ever ever lie for anyone ever. Politics is a hard game especially in companies that are changing a lot, like startups. As a contractor you can have a professional armour - you have an obligation to give unbiased advice and opinion.
Not the companies problems are not your problems. Do not take on board their views of "if only we can hit this deadline we can make the sales and hit 100M..." - you should give your real views on the state of the codebase, the likelihood of hitting the deadlines and the tech debt.
Go read the clean coder (with an r) by uncle bob martin.
5. be your own project manager - that is track in your own system the tasks needed to achieve the requirements and the likely ship dates. Don't keep this a secret but don't rely on someone else tracking this for you. I recommend fogbugz these days (it's for pay). Don't touch Redmine with a barge pole. Basically know that the two week estimate the sprint just made is bullshit. Be clear on what your estimates are - no need to be shrill, just be clear, polite and consistent.
6. Be calmer than everyone else and realise this all takes time.
7. Don't take career advice off random people in the Internet :-)
Anyway, if I was to give our hero here any advice, it would be to see himself not as an employee but as a consulting company - if POV at Parc Xerox was worth 40 IQ points, in our business I would say POV is worth 40k pa.