$58? It should be more around $30.
Basically, you code in the program AVR Studio. If you use the expensive programmer, you can simply click a button in that program and it will download. If you use the cheap programmer, you will have to download a separate program (ponyprog, avrdude) that will program the chip through the serial port.
Many computers nowadays don't have a serial port, so keep that in mind if you are planning to upgrade your computer in the future.
Also, instead of paying $12, it is really easy to make your own serial programmer. You can purchase a serial plug from digikey for a dollar, and then all you need is a few resistors and diodes.
See the top-left part of the image below with the serial port.http://www.ladyada.net/images/minipov3/minipov3schem.png