I used to install Alarms for a job, but only for a few months so I'm no expert.
Really it all depends how far you want to go/how much you want to spend. A simple box on the outside wall with a flashing red light might be enough to encourage a burglar to try a different house instead of yours. Or you can go the full way and put contacts on every door and window, with PIDs in every room, and have the whole system monitored 24/7 with the police alerted when it's triggered.
I don't have much experience with cameras, but I think you'd be better off with a visible camera rather than a hidden one, as I'm sure you'd rather the potential thief saw the camera and walked on rather than they break in but get caught on camera. A guy I worked with last year bought a setup from Brookers that was pretty nifty. He had a TV in his kitchen which displayed the camera feeds constantly and you could switch between them with a remote. Not sure how the recording worked on it though, think he spent about £400 + TV.
Edit: A quick browse of Maplins and there are plenty to chose from. SOmething like this:
http://www.maplin.co.uk/4-channel-320gb-network-dvr-with-2x-night-vision-cameras-and-smart-phone-access-632889 plus a monitor should get you going. I don't know if that particular one is any good though, I just picked it at random, so do a bit of research first.