The problem with SW is that they are not forgiving of mistakes. Any drastic temp changes, specific gravity changes, or build up of ammonia, nitrate, etc have a severe effect on their health faster than if problems were occuring in a FW tank.
To go with the 20 gallon would be a good idea. You could set up a nice tank relatively cheap.
You will need a hydrometer to measure the specific gravity of the tank (salinity). You will need some instant ocean salt mix. You will also need a filter. I prefer the Aquaclear ones because they are easy to customize the media you use. A protein skimmer would be a good idea but since you are not keeping corals and doing only fish, it is not required. You will also need a cover and a normal strip light (nothing fancy since you will not be keeping live corals so you do not need the expensive lighting). Last piece of equipment would be a heater and thermometer. For the tank, used sand. Don't use crushed coral or shell bits. Fine grain sand (about 4 inches thick on the bottom of the tank would be best). Get about 10 pounds of cured live rock.
I prefer to mix up the water seperate form the tank. I also do this with water changes to get the SG correct and the temps right before adding it to the main tank.
Get a rubbermaid tub (32 gallon is what I use) and fill it a bit more than halfway with freshwater and add the salt mix. Usually about one and a half cups of salt mix per gallon of water will give you the right SG. I prefer to be at 1.023 SG in my tanks.
Mix it thouroughly so there is no white cloudiness or solid bits of salt left.
Add a heater anfd bring the temps to about 78 degrees. Wait 24 hours and check the SG.
Once the temps and SG are where you want, pour it into the tank. Add the sand and the pieces of LR. Add more water if needed to fill the rest of the tank. Make sure the bottom pieces of rock are secure in the sand (bury them for stability - don't just rest them on top of the sand).
Let is sit for a few days all set up and keep monitoring the ammo. The live rock will start the cycling and also seed the sand with the hitchiker copepods and worms so you will have a live sand bed overtime. When the ammo climbs, do a 25% water change (do not ever vaccum the sand or you will kill the critters being established).
When the tank stabilizes add a pair of tank raised clownfish. They do not need an anemone so don't let the petstore try and sell you one. Clownfish can change sex so if you get 2 of the same kind that are young (small) you will be guarenteed to end up with a male and female.
Do not ad more than the 2 fish at once.
Stay away from damsels. They are colorful, cheap, and VICIOUS. They are very territorial and will attack tankmates.
Also stay away from mandarin gobys. Petstores carry them but they will starve to death. They feed on copepods and unless you have a reproducing colony in your tanks, they will die from refusing to eat prepared foods.
If you want a bright yellow fish that would go in the tank and not fight, try a yellow coris wrasse. Peaceful, hardy, and the color of a tang.
Other choices would be firefish, basslets, hawkfish, dottybacks, dartfish, and a pygmy angel.
I would say no more than 4 fish in the tank.
You could also only get one clown fish if you prefer to have 4 different types.
It is your choice.
Personally, if I were doing it, I would get these.
1 clownfish (the ocellaris or a true percula)
1 dottyback (the purple pseudochromis)
1 firefish
1 pygmy angel
Good luck with the tank and post any other questions you might have.
, but after rereading it and taking notes it really wasn't so bad 
. I only have a few more questions...1.what is SG? 2.Is the ammonia measured by those paper strips you dip in the water? 3.Do you have to scrape the sides of the tank like with a freshwater, and do you ever need to clean or replace the sand?