Well, I use Dreamweaver and Fireworks for web designing. Although I do have others(photoshop, notepad++ etc). But, I prefer the code interface of dreamweaver to its WYSIWYG GUI because I can design however I want, and it helps reduce bulkiness of codes.
I would rather you use dreamweaver if you can get it because it helps you to understand CSS more. And no matter what interface(coding or drag and drop) you would be using, there are aids provided already to make designing simple. But, if you don't want to pay, I think Notepad++ is ok.
For graphics IMHO fireworks is ok for its simplicity of use. Although you can consider Photoshop or GIMP if you don't have money to spare.