Er... Not really
> Instead of getting the big clumsy set ups that usally go with recording,
> can a ibook with a couple of mics and GarageBand give me a good recording?
Good recordings are defined by the quality of your sound source, the environment that source is in, and the recording devices.
Assuming your instruments are fine, you have to consider your acoustic space. No point having top-quality mics if you're recording in a tunnel at peak time traffic, for instance.
Finally, the recording method. GarageBand is not primarily a recording environment. It's a self-contained mixing environment... that allows you to record original source. Using GB for the purposes described is a bit like using a Swiss Army Knife at a formal banquet - The job will be done, but you'll find that with the wide range of tools comes the limitations of non-specialisation.
> Will it allow me to edit? If so, do I need an interface and what type of microphones?
Microphone selection and placement is a can of angry giant centipedes for the beginner. A simple arrangement can be to use your head as the 'mixing environment'. Arrange the band in an acoustically pleasing distance from you as the conductor. Have an especially critical ear toward echoes and reverberations the room you're playing in has - You might want to isolate and absorb some frequencies with blankets, foam and dampners placed on walls or at strategic locations.
Set up two identical, studio mics in a crossed-pair arrangement for stereo recording, positioned above your head.
Those mics would be connected to a pre-amp mixer-D/A converter, which would then run into your Mac.
The software you'd use might vary. I'd recommend against GB for your purposes, because it occupies RAM with software you will never use, RAM that would be better used to store recorded sound. There are a number of simple sound recording applications around that will allow you to edit and mix. Heck, if you have a Classic partition set up on your Mac, you could use several Classic-based applications. When I'm doing serious sound mixing, I use DigiDesign's ProToolsFree, which is an exceptionally powerful sound and MIDI editor, dedicated to recording and post-production.
Hope this helps,
-Oro