Hello there. I am far from an expert at this stuff either but I have my own room set up much the same size as yours, with a guitar amp bass amp, drum set, and recording desk. Firstly I noticed you didn't mention an amp for the midi keyboard. Will you be using that for extra tracks after the initial recording and not going through an amp for the 'live' session.
I sense a bit of a problem with your intention of having everyone playing at once when not all instruments will be audible (notable vocals and the MIDI keyboard) without some kind of amplification.
The typical way to get individual tracks from a group is to separate everything in isolated areas (Perhaps you have heard of the amp-in-the-bathroom, or amp-in-the-closet inprovised isolation booth?) while everybody has a headphone monitoring the whole mix, but the individual instruments are all in different inputs by themselves in other, sectioned off places. This takes lots of headphones, isolated spaces, input channels, headphone routing, and is pretty much impossible in an 11' x 16' room. It will be VERY difficult to isolate anything in a whole band playing in the same small room, so maybe a different approach entirely should be taken? Good recordings can be made by micing up an entire room from different corners and blending all of the room mics (as many as you can get is nice in my experience but 2 decent condensers can work too) in a mixer, then send the mixer main L/R outputs to your recorder.
You mentioned you have two inputs. It all depends on how you assign them in your recorder as to whether or not they will be going onto the same track or two separate tracks.
There is a way around this isolation problem. It is improvised and not exactly studio standard, but then neither is doing everything in an 11x16 room. Corners must be cut a bit. Awkward, but it works:
Set up your room just like you would your practice area (which you mentioned you wanted anyways). Get the gang together for a practice and while you work on a song, mic up the room with 2 condenser mics, each going into a separate channel of the recorder as you play a song all the way through just as if you were recording it. Make sure all the levels between instruments are more or less balanced the way you would like to hear it sound on a recording. Record it, a nice simple stereo recording of the sound of the whole room playing at once. This will be your scratch track.
Go back over it with each instrument playing along to the scratch track for timing and as a guide to the position in the song, using headphones. I like to do drums last because they are the most overpowering in headphones, and its nice to have all the other instruments layered loud in additional to the scratch track to play along to?
So your session would go something like this:
1st time around: everyone playing, record room mix as scratch track
2nd time: guitarist plays isolation part along to scratch track
3rd: bassist plays along to scratch track + guitar
4th: keys plays along to scratch + guitar + bass
5th vocals + etc etc you get the idea...
...last: add drums to entire mix except for scratch track
It may be necessary to redo any or all of the parts once you have a first run of all the isolated instruments without the scratch track, just to fine tune the timing or groove to the new, isolated recording layer. So do another pass of anything that doesn't sound like it fits with the fest of the groove, 2nd time with no scratch track, and just all the isolated instrument recordings to play along to, repeat over and over gradually getting more and more into the 'feel' or groove or whatever you call it of everyone playing together. Depending on your kind of music, the complexity and nuances and all that ambiguous stuff involved in how you play together, and the skill of the players this may not be necessary, or you may have to make a few more passes unil everyone sounds like they were playing together even if they aren't on the actual recording, they are playing along to a recording of everyone playing together. The better you can duplicate the origional feel, the less passes are needed. Et voilla... now you have isolated tracks of individual instruments all (in a virtual sense) jamming together in a tiny room where this is actually not physically possible.
So now you have separate recordings of every instrument playing along to the same origional feel as when you were playing together, you can mute the scratch track and just use all of the isolated instrument tracks now recorded in your computer for your mixing.
as for what setup is best... Thats a bit tricky. you'll want to think of the room as two separate areas, the 'performance space' and the 'mixing space'. I have mine laid out kind of like this (sorry for primitive diagram):
..............................-...mixdesk..
..\.......AMP........../...-...........m..
.....O....AMP..............-............i..
..............................-......O....x..
.................DRUMS...-............d..
AMP............DRUMS.O.-...........e..
AMP..O........DRUMS....-...........s.
.................DRUMS....-............k.
..............................-...............
..............................-...............
../.........AMP..O....\....-...............
.............AMP............-....DOOR...
O are people places
/ \ / \ are locations of mics for room recording
- is a 'curtain' of very thick layers of wool blankets and sleeping bags draped over a clothesline, separating the performance area into a cramped, but kind of dampened square off of the rectangle. The other side is the desk area and storage/junk etcetera area. The interior walls are mostly just drywall with bits and pieces or random foam, shag carpet, cardboard and more blankets attached, really anything without a smooth surface. This is however, the ghetto method and I'm sure there are plenty of better (and more expensive) ways to do it, but as a starting point it worked for me.
You have many questions, I hope I could at least offer you some ideas to mess around with. As far as monitoring your mix and placement of the monitors, it really depends on the monitors. They should have some kind of a diagram of some kind of optimum range and placement in their user manual I would think.
