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Carve out a couple Gs to buy some sound conditioning material to make the room sound good. More important than the gear, as far as getting "studio quality" sounds. Don't just hang blankets, get some good sound absorbers. Especially important for drums and vocals, both of which you want to record.
Then focus on getting 4-6 channels of pres/convertors and the mics to complement. This is all VERY doable on 10k, especially if you sell the lower end stuff and add a few bucks to your budget. With proper sound conditioning and 6 channels you'll be able to get very nice studio-quality recordings, and some of your "demos" will have permanently usable tracks.
Also consider renting mics for vocals. You can often rent super expensive mics for less than a hundred dollars a day – much cheaper than going into a studio for a day. If you have good quality gear, the right mic AND a set of good gobos to get a tight sound you can really take your time and get the best vocal takes in a relaxed atmosphere.
congrats, what an awesome opportunity!
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