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Well a preamp does what it name implies, it amplifies a weak microphone or instrument signal to a workable line level signal (line level that is used within a mixer or soundcard).
A very basic preamp does only one thing. You plug a mic in, and you adjust the amplification with a button. That's it.
Nowadays you can get more features, but they come at a price. For example, a preamp can come with a compressor, EQ etc after the actual amplification stage. Usually we talk about a channel strip or a voice channel in that case.
Sadly, good preamps come with a hefty pricetag. So, you won't really cut it with 250-300$ if you want all the extra's and quality at the same time.
But first, the main features. A good preamp should have phantom power ability, for condenser mics. It should have decent input and output connectors, and a good range of amplification.
Extra features that can be very useful are a lowcut filter (to reduce handling rumble) and an instrument input (instruments have an impedance that should be matched, so it's not a good idea plugin them in directly in a mic or line in).
All the rest are really extra's. You can have EQ (on some it's even very basic), a compressor. Some have even an impedance selector, which can make the sound of a microphone change (mics are designed to sound like their specs say at one certain impedance, at other impedances they can sound completely different). At last you have the tube preamps. Those are known for the fact they sound warmer (as they add a little fuzziness), but are usually much more expensive.
Now, for your price range, I'm sorry to say you won't be able to get loads of extra's. M-audio has two very simple preamps in that price range, the Audio Buddy and the DMP3, which are both dual channel (2 inputs available at the same time). They both have mic and instrument preamps.
Behringer has some too, but frankly, stay away.
If you want already a better range, but I think 300$ won't be enough already, look at the Focusrite Platinum range.
Would you need a mixer? Depends on your workflow. Some people can work without, some can't. They are very useful in monitoring. But one thing to consider : if you take a decent mixer, a preamp isn't really necessary anymore (if you're on a budget, in pro studio's separate preamps are prefered because they blow away the integrated mixer preamps, we're talking about big bucks devices here though).
For example, the Mackie VLZ range of mixers have pretty good mic preamps for the price. Nothing that would hold you back at the moment. The only thing is most mixers don't have dedicated instrument inputs, but you can solve that with DI's (direct injection boxes, pretty cheap) or by using your guitar amp/effects box line out (which I remember you already had). Plus, with such a mixer you already have a decent EQ section.
I'm talking about the Mackie mixers, because from experience I know those preamps are good. Behringers on the other hand are noise hell...
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