If you are okay with gently used clothing, the first places you should try are freecycle.org, craigslist.com, consignment shops, thrift stores, and garage sales.
If you want to buy new, TJ Maxx, Marshall's, and Ross's is pretty cheap (Gerber pack of 5 onsies are 5.99 there to give you an idea.) K-mart is on the verge of going down, so they run clearance often. I found a pack of 5 long sleeve onsies there for $4. Target and Walmart are reasonably priced...a little more than the previous I listed, but you rarely have to pick/dig through to find deals. (Always be sure to check their clearance section...target had a few onsies for a dollar a piece the other day when I went.) And then there are the stores like Old Navy, JC Penny's, and Kohl's. Reasonable in price, but definitely not the cheapest.
As for the sizes, I have bought some onsies in each size. Just incase he is on the larger side or if he grows out newborn size within the first couple of weeks. 2 or 3 gowns should be good to start.