iSCSI isn't any more expensive than setting up a NAS... Just using a different protocol. Depending on the SAN/NAS you get it could very well support both iSCSI and NFS protocols. In my experience, the better devices support both, letting YOU decide which to use. Since you'll need the ethernet backbone to work with a NAS (NFS), that's no different.
The way I've always setup hosts and storage, you create LUNs for the hosts to see, which are then formatted with VMFS, which makes it available to use for VMDK and the VM's. Unless you plan on playing with data dedupe technologies, iSCSI is a very viable option.
BTW, I've setup vSphere clusters/environments that used iSCSI for all the storage. It's historically been far less expensive than fiber, and when done right, you get great performance from it (also not busting the budget). If you already have decent physical switches on your network, you can do iSCSI easily.
I have a single host in my home lab right now. But, I have a iSCSI storage device (QNAP TS-559 Pro+), and a HP ProCurve 2510G-24 switch. When I setup more hosts, it will be easy to add the iSCSI LUNs to them. I'm hoping to be able to add either one more host, or change to two new hosts, before the end of this year, or early next year.