I'm cheering you on, Gabel.
chopping out housings can be very fast, no templates to figure out, your layout time becomes your setup time... I use the adze(short handled) to chop out where you are using the axe. However, since I took up teaching I've realized that the hand tools are not for everyone and also I've realized that starting into chopping an 8x8 can be intimidating. You need to practice a while before you get fast. A suggestion I would make to someone interested in using hand tools rather than the dusty, loud and expensive to run electic tools is this: Take the price of your power tool and convert it to hours of pay, spend that time practicing housings on waste timber, preferably after watching an experienced person work the adze or axe. Then see if hand tools are fast and accurate enough for you.
A side benefit of using these tools is that you gain strength and vitality, which can be used in the evening(wink) and eye hand co-ordination, which can be used on the playing field...

as far as answering the question, I'd buy the cheapest router to start with... wear it out and then you'll know what you want in a more expensive router. I made a template from birch plywood and used upside down cariage bolts through nuts welded on angle as levelers. half or three quarter bit is PLENTY imo.