I would like to know the difference between a spinning and a baitcasting reel and the rod as well.
Why are they so costly?
A spinning reel is the one where the reel sits under the rod when you are fishing and the spool is fixed and does not rotate when you reel in the line. A conventional reel sits on the top of the rod and the spool axis is perpendicular to the rod axis and the spool rotates when you reel in the line.
A spinning reel is much easier to cast for a beginner whereas a conventional reel needs some practice to cast but can be learned easily. Spinning reel is easy to cast lures lighter than an ounce (against the wind), now there are magged conventional reels that can do this job quite easily.
A conventional setup will cast further than an equivalent spinning setup (for lures over one ounce).
If you are casting heavy lead and bait (8nbait), a conventional is the way to go, a spinning gear will cause a lot of pain in the index finger or you may bend the shaft of the spinning reel in due time. Using gloves for casting big weights will be more forgiving. When using braids lines for heavy lures with a spining gear, a Breakaway Canon if used will increase the distance of the cast and also protect your index finger from cuts.
There are very good chances for the bail to shut in the middle of the cast in a spinning reel and to loose the lures. No such problem with the conventional reels. But you can go with manual bail or bail less spinning reels for this issue.
A conventional reel is more compact in size when compared with the spinning reel with the same line capacity.
It is easy to pick up occational backlashes on a conventional reel than to remove the line twists on a spinning reel.
If you have not tightened the drag on a spinning reel before casting, when using braid and heavy lures or bait, then you risk making deep cuts in your finger. No problem with conventionals.
If you have waded till waist deep water in the beach and casting plugs, then a spinning gear is the way to go.
There are both costly spinning gear as well as conventional gear, but a conventional rod may cost a little more than an equivalent spinning rod due to the extra guides.
You need not spend too much on a conventional reel because the design of the conventional reel itself makes it to get a decent reel at a decent price, but I have heard that it is not the case with spinning reels.
Choosing a spinning gear or a conventional gear is one's personel preference, some prefer spinning gear, I prefer my reel to sit on the top of my rod and hence chose conventional.