Mark Danger

Just keep writing. They say that to learn to draw you should take a six foot stack of plain white paper and fill the whole thing - by the time you're done you'll have some idea what you're doing. Writing - as does any skill - operates under the same principle. When you're not writing, read. Read as wide a variety of works as you can muster. See a word you don't know? Look it up. Exposure to words is the only surefire way to not only expand your vocabulary, but to give you a good idea of what's already been done. Lastly, allow yourself to write crap. Be okay with it. Trudging through your own sub-par work is the only way to get to the good stuff.

Line in is really not a bad way to go at all. Guitar Rig is great, for example, though I find it gets finicky with too many instances running simultaneously. Record it a few times in a few ways while playing when the panning and you can get some very nice, full tones. I've had good luck recording acoustic guitars with a direct line and microphone at the same time. If you have to choose on or the other, using a microphone is the only way to go.

Truly, this is horror. Does anybody do Deacon Blues on ice? That's a thing I'd watch.