In most areas of the country, a home vinyl home has more value than one that's not. In extreme cold temperatures, over time, vinyl will crack. In extreme hot temperatures, over time, vinyl will 'limp'. And where temperatures fluxuate a lot, well, vinyl does pretty well under these conditions. If your home is in an area where it's very hot an awful lot, I would consider stone, brick, adobe, etc., etc.. If your home is in an area where it's very cold a lot, wood may be best.
Now, as to your costs and to what BILL has already said, there are a number of 'things' that you need to know. Assuming vinyl siding is popular and OK where you live, yes, repair the wood first before you do any siding. Otherwise, your siding could fall down in due time because the nails will no longer hold in the wood that was just starting to rot! Also, depending on which mfgr you go with, I suggest you read their warranty FIRST before you buy, even if a pro is doing the installation. WHY??? Because if the siding isn't hung on a warranted 'surface', you could void the warranty. I installed Ashland-Davis and it simply called for a flat, smooth surface. I had to go down to the gypsum board first, then put up Homosote Insulation Board, then put up my siding. Had I gone right over my cement shingles, and had a problem with the siding, my warranty would have been voided because the shingles weren't smooth and flat. Also, depending on where you live, there are different thicknesses of vinyl. I suggest a .042 thickness or better. Yes, it will cost more but it will last longer too. Just because you have vinyl doesn't mean it won't have to be replaced some day. It basically means no more painting!
The value for this type of job depends on where you live too. If existing homes in your area are 'hot', then you could recover the costs in as little as 3-5 years. If they're not, it may take up to 10 years to recover the costs. If you plan on doing this job yourself (which unless you're a semi-pro Do-It-Yourselfer), I recommend a pro to do it. This is one of those jobs that if it's not STARTED properly, you could end up with a funny-looking job. Ashland-Davis has a great site for any DYIer who want to look at products, check out the installation process, and more! If you decide to go through with the job later on, e-mail me directly and I can share some 'tips' with you BEFORE the job is started. My best to ya and hope this helps.