I have dreams about expanding my hobby to something more, but I am not yet ready or willing to abandon my reality. And everything I have read warns against it for some reason or another...
You will always hear warnings from people. But then again, no one ever achieved a dream by strictly obeying a warning. The task is to figure out what your dream is. There are so many ways to expand your hobby, you'll need to decide which is right for you. Do you want to be a commercial photographer? An occassional stringer for your local paper? Do you want to get in a local gallery or sell a few prints in a local coffee shop? Or do you want to be a high-powered fashion photographer? Many paths.
First thing, is to do a ton of research on the business of photography. I am always surprised at how many people try to start a business without "running the numbers" first. Get a spreadsheet and calculate the cost of an imaginary business (equipment, rent, supplies, product lines, potential profits).Talk to local pros. Ask lots of questions. Volunteer as an assistant to learn the ropes. Etc.
There are some good books by John Shaw on this, including Business of Nature Photography. Caroll Michels has a good one on the business of art, called How to Survive and Prosper as an Artist.
With what do I take the pictures with; something that will allow me to grow and I can grow with (digital or film) ?
Shoot with what you have. Buy new equipment when you know exactly how it will improve your work, not on the hope that it will. It's always better to have less than more.
Dan