I think asw000 is talking about mixing, not tracking. So I don't think he needs mics and preamps.
I run DP 4.6 on my iBook, so I'll make some suggestions.
Max out the RAM in the PowerBook, if you haven't already done so.
If you don't have a pair of decent powered monitors, get some. These don't have to be top of the line, but you can easily find a decent pair in the $300-450 range.
The rest I would spend on plugins, and just mix the whole thing in the software. For $1,000 you can't really afford the kind of gear you'd need for mixing outside the box, so just stay in the software.
Some plugins that I can recommend are:
Sonalksis:
SV-315 compressor and SV-317 EQ.
Elemental Audio: Anything they make, but in particular their Equim eq is very clean and flexible. They make a good brickwall limiter called Finis, and an unusual but useful compressor called Neodynium. The whole bundle including their mastering eq "Firium" sells for $349.
PSP Audioware: Vintage Warmer and MasterQ. I use MasterQ constantly, excellent plugin.
There are also some great freeware plugins for the Mac OS. Take a look at:
http://betabugsaudio.com/
http://destroyfx.smartelectronix.com/
http://apulsoft.ch/
Plus one of my all time favorites, King Dubby:
http://www.lowcoders.net/kd.html
I'm recommending these plugins for a couple reasons. One, they sound good. Two, they take a relatively light hit on your CPU. So you should be able to do a real mix with them on your Powerbook, assuming it's not a really old one.
Use the CD burner that's in your Powerbook. However, if you don't have burning software you'll need to get that. You may also need two track editing software for your final masters. So a really great option for cheap is a program called DSP-Quattro, which can be found at:
http://www.i3net.it/Products/dspQuattro/Asp/Index_EN.asp?Language=EN
This is a full featured editing and burning program, with tons of features and is completely professional. You can upsample, downsample, dither, etc., etc., etc. Great program for a great price, I own it and use it. I also own Peak, but do 99% of my work in DSP-Quattro now.
Hope some of these suggestions prove helpful to you.