I own lots of hardware. I really believe every hardware head entertains the thought of going all software. I think about it alll the time.
Software advantages As I see it =
*Less physical space taken up
*Less heat build up (a room full of powered up gear gets hot)
*More powerful sequencers with tons of audio tracks and flexibility
*HUGE variety of instruments fx and other goodies lots which are inexpensive or free
*Patch and preset selections are usually automatically saved with the project or session(hardware patchname scripts for hardware are a pain in da azz)
*
Disadvantages
*Good BackUp practice is a MUST
*IMO the best VSTi's require GIGs of HD space(not a biggie with the huge internal and external HDs plus they aren't terribly expense)
*No resale value with software purchases.
*Your common bugs and problems that come with dealing with computers
If you maintain a powerful stable PC disadvantages should be at a minimum.
Honestly if i was starting over from scratch, I'd go mostly SW with a couple choice HW synths. And a nice tube DI and/or a compressor maybe to run sounds out and thru for a bit of flavor. But I'd mos def have a top quality Midi Keyboard, Drum Pads, a control surface, and quality monitors, the works to make it as hands on as possible. It would be a less expensive studio but not cheap by a long shot