ProTools is the way to go.
Here's a piece of a tune I recorded without using a single microphone. ProTools7.1, using the Digi002 interface. The gutar sounds are an Ibanez Destroyer running through Guitar Rig II. The bass is a Spector 5 string running through Amplitube. The drums are BFD Lite (included with ProTools). This is an early version of the track, and just a rough mix. I've done considerable work to it since, but it'll give you an idea. Despite the extra expense, I feel that Digidesign has the best stuff out there for home recording. I've recently upgraded to ProTools 8, and the MIDI handling is now really useful as well.