Will my .mac email stop working for me when my account expires? I really don't have an extra $100 right now.

Yes. On the .mac page it says Inform your contacts of your new email address if you have one. Any message sent to your .Mac Mail address after the account expiration date will bounce back to the sender.
However, it seems that you can get an email only .mac account for $10 a year.
http://forums.macrumors.com/archive/index.php/t-7880.html (second to last post). Hope that helps.

I'm interested about .mac accounts. Could you tell us about the benefits? I think its an awfully steep price for what it is, but maybe I'm missing something

I actually got it free when I bought my iBook. I didn't really use it except for the email. Basically, its only useful if you have multiple macs and travel a lot.
The "benefits" are really not worth it for someone with one or two computers.