Yes, the lighting equipment is an investment, but a good investment because good stuff can last many years, and it is really nice to work with decent gear all that time, more fun than fighting the cheapest stuff. If ever needed, the AB lights have legendary support and service, which is quite unique today.
Just talking, but the 160 watt-second lights should be more than enough power in the living room (excluding maybe school gyms and outdoor sunlight, etc). Distance and aperture is what determines power needed. 160 watt-seconds should allow f/8 at full power in umbrella at 10 feet (counting that our ISO 200 cameras are one more stop stronger than ISO 100 cameras). The 10 feet could be right for a group of people (or 20 feet should be f/4), but for normal portraits, you would want the lights much closer, really as close as you can work around, and so then you turn them down to maybe 1/4 power, even for f/11.
The main idea of the umbrella or softbox lighting is this: If a light is distant from the subject, it is a "small light source" due to looking small in the distance, and any small light causes dark and distinct shadows (nose and chin, etc). Like the sun is pretty far away. :) But put the umbrella up close at 4 or 5 feet, then it looks really large to subject, in their face, like a big wall of light. Some of its light comes from all directions to the subject, from the left, right, up, down, and this fills in shadows and becomes a very soft light which you will really like. Nearly magic, and add a second fill light, and you have true magic. Large is how it works, and close is how it is large.
This is also why we bounce a little flash head from the ceiling, because the ceiling acts as a very large light source then, shadows become indistinct. If we could just get the ceiling closer... :)
There is essentially no difference in the light from white umbrella or softbox. Softbox light is more contained, better aimed, does not scatter so much light all over the room. You dont want your green room walls to act as a reflector, but if the lights are close and walls relatively distant, this scatter is too weak to be much factor (again due to inverse square law). Primarily, the softbox can be placed closer due to umbrella stand and shaft being in the way, therefore it can be "larger" to subject. But a shoot through umbrella can similarly be placed close too. Overkill much of the time, and the main problem then is that the umbrella spokes probably reflect in the subjects eyes, and the softbox does not have spokes. If you can leave the softbox setup all the time, it is very convenient. But the umbrella is much easier to transport.
You may find this interesting about umbrella choices:
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When you get your lights, set up a tabletop with maybe a vase or something round that will cast a good shadow. Photograph it with 1. One bare reflector, 2. Two bare reflectors, 3. One umbrella, maybe 10 feet, 4. Two umbrellas at 10 feet, 5. one umbrella as close as possible, maybe 4 feet to fabric to have room for camera, and 6. two same umbrellas. Examine subject and shadows. Then you will fully understand the idea of it.
If you have a background screen, then a background light really is often an important factor, to make it "be right". We can really change a background with light. But with just two lights, the background could still be the Christmas tree or the fireplace, like regular snapshot settings, but with really nice lighting. The light does fall off fast with distance behind (2x distance is 1/4 light, 2 stops down), but that can help sometimes too. Normally a lighted background is back farther to prevent interactions. A close unlighted background (using screen or not) is much brighter, but can cause shadows. However, with an umbrella (large), the shadow is weak and diffuse, and with two umbrellas, one fills in the others shadow, and it generally disappears.
As to working without a hair light, consider the background to suit the hair, worst choice is dark background with dark hair - hair blends into background that way, subject does not stand out without a light on it. Little things, but it can make a big difference. The hair light is nice to add sparkle to the picture.
Without a flash meter, try to make your lights are as equal as possible in all ways with respect to subject (esp distance and power). If you want a ratio, say one stop difference, then with equal lights, turn one light down one notch of 1/2 power (not as exact as metering, but close enough).
Use the white towel method previous linked for camera exposure. But if you really get into this, and I bet you will, there is a little more to it, and the flash meter will be a real blessing, much like the meter in the camera is a real blessing now for that work. I use the Sekonic L308S meter, about $180 I think, which is cheaper than many, but a fine brand reputation, and is also a really good investment for studio flash. It simply just works.
Anyway, hope some of that helps with the decisions.