First, from one N scale modeler to another N scale modeler:
Welcome.
You are at the right place here at Zealot ( formerly The Gauge ) Model Trains forum.
You'll find here a bunch of very friendly and helpful modelers.
First, you didn't mention the size of the space available for your layout.
What size is it ?
The folowing link will give you some track plans from 24" X 48" to a 78" X 30" layout on a hollow core door.
Those layouts use the N scale Atlas sectional tracks available at almost any hobby store.
Mike's Small Trackplans Page
Atlas have some track plans on their website too:
Atlas N Code 80 Layout Gallery
A very popular N scale layout is the "Carolina Central" on a hollow core door:
http://forum.zealot.com/t108951/
another link:
Small N Scale Layouts Under 4X8 Feet (ALL NEW)
I would stay away of the starter sets, go for good quality equipment:
Most important, a good power pack will save you a lot of trouble. No need to buy one with plenty of options such as momentum , pressure sensitiv bracking, etc..
I highly recommend their Tech 4 200 model.
Engine : Go with a small Diesel engine, such as a GP7 or GP9 from Atlas ( Life-Like , purchased by Walthers make good engines too ), unless of course you want to model a more modern era.
http://www.atlasrr.com/Images/NLocomotives/ngp79/32906/48072TQ.jpg
I never used Kato sectional unitrack, but I've heard good things about it.
Jacques