I add my sweetener and vanilla (and unflavored gelatin) when I start to heat up my milk. I find that the vanilla extract added later leaves a slight alcohol flavor in the yogurt and when I add it at the beginning, the alcohol has time to evaporate.
Holly, if you are just starting out, you can buy either plain or vanilla yogurt at the grocery store to use as a starter. Get the very latest expiration date you can find, and make sure it has live cultures in it. The more variety of cultures, the better it is for you. Once you find that you enjoy making it, you can buy cultures at places like www.dairyconnection.com
or Ricki's...look for the link in the stickies under suppliers...I can't remember what it is off-hand. Also, if using storebought yogurt for your starter, do not open it until you are ready to use it and only use it once for that purpose...once you open it, there is the potential for contaminating the starter. There will be more yogurt than you need for starter, so just eat the rest. After that, you can use the yogurt that you make to be your starter for the next batch...just make sure that there's one container that you don't open until you are ready to use it for starter.