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Recording Quality

Hi,excuse my noobness but i am kind of at the end of my rope trying to figure what i am doing wrong.Maybe it's equipment but i think it's probably just me.
Here is what i have,it's a karaoke system...
Allen & Heath USB Zed 12FX Mixer
Yamaha P5000S Amp
Sonic BBE 882i Maximizer
dbx 266 XL Compressor on the mic channel

CD Quality Vocal production

I've recorded my wife's vocals over a karaoke backing track. I am a beginner when it comes to music editing, and I'd like to know what are the steps and best practices when it comes to editing. I'm using Mixcraft 5 as my DAW, and I just installed the trial version of Auto Tune which works with Mixcraft. I have two tracks: one is the backing track, and the other one is the vocal track.

getting good quality sound in spite of complicating factors

I am wanting to get into podcasting with a limited budget. I want to come up with the best set up for getting good quality sound. I will be setting up my studio in a room in my house which is about 300 square feet and is fully furnished as a living room. Due to many factors, the studio must be in this room.