Depends on what you are wanting to do. Some people like 1ft square sections, but I personally do not like the extra gaps. On the other hand, larger setups require you to actually plan around where to store things, and can prove troublesome for transportation.
I am actually trying to sell my group on this sort of thing, so I am putting together a new set of terrain, and I'm hoping to document the process. So keep an eye out for that. But as a preview, since your location says Colorado, let me make a suggestion: you can buy a 2ft by 2ft piece of MDF at Lowes or Home Depot that can serve as a perfect surface. MDF is a bit heavy, but with the dimensions already figured out for you and the price being something like $6 US, it is a great way to get started for relatively low investment.
Regarding buildings, paper can look really good, but I'm in this for the hobby, so I've acquired some Pegasus and GW stuff myself. I'll be making other buildings from balsa and foamcore.