The ins and outs are line level. You can plug up to 4 line level signals into it. This would include a POD or Bass DI box or microphone preamp or whatever.
Microphones and other low output devices (like guitars) are not line level and require something to boost their signal a bit....that is, a preamp. What you're discovering is nothing new.
Your choice of preamp will greatly effect the sound you're going to get (as will your choice of mics). On a budget, many of us around here use the ART Tube MP which is a tube microphone preamp that starts about about $99 for the single channel and $230 for the dual channel (which is rack mountable and all-around nice).
So, you'll need as many preamps as you'll need. One preamp for each mic you'll be using at the same time basically.
You can get a mixer...which isn't a bad idea as long as the mixer has built in preamps (if it has microphone inputs then it has built in preamps). However, you're going to get a crappy sound out of a crappy integrated preamp on a cheapo mixer. I guess it all depends on what you need vs. what you can afford! Welcome to the club!
Slackmaster 2000
