Greetings...
I have seen everything in terms of online gaming. Mushes, PBeM, WebRPG, ICQ and IRC. Ultimately, I think the best thing is IRC, with ICQ/MSN/Yahoo running a close second. But only for live situations.
Personally, I would go with a Message Board/Email combination, with IRC when you can occationally do it. I don't know if you can start any boards here on EN World...
But I do know there is a D&D Online site. Just Google D&D Online, and you should find the place easy. I, being the way I am, like to work with two or three boards. One for 'official' DM posts that give out situational updates, all in one location, so that players can read them without having to do too much digging. Then have a second board for player's posts, and roleplaying. A third board for player's questions and Out-of-Game discussions.
Then you can have Email for One-on-one private conversations/roleplaying, and private communications with the DM.
Also, PBeM is good for setting up the situation, giving out weekly summaries of what is going on in the game...because you really do need it to clear up everything, and the only person who knows what's going on is you, the DM. Also, it keeps the players 'active' if they keep on top of their email. Then Cross-Post this update to your gaming board.
IRC is good only when you can get all the players there. I used to run a couple of games on IRC on a weekly basis, but it was generally freeform. No set characters, just roleplaying fun and a bunch of pre-gen characters I made. I did start with a set of regular players, but sooner or later, one couldn't make it...or one forgot. Or one would say that they couldn't make it, and was just dropping out without being honest. I don't think you'll have too much problem with that, considering you personally know all your players.
As for combat. I've seen people deal with this in a couple of ways. One, the DM rolls all the combat. Who then posts Round-by-Round actions to the players, who then in turn tell them what they want to do. Usually it's a 'daily post'. (Where roleplaying and questions and secret communications/actions to the DM are also done during and throughout the week, and on the weekend a weekly post is made by the DM.)
Second, the players roll their combat. Keeping players honest is hard to do, and combat goes very slowly, unless it's on IRC, but still, even then it's slow. But it still keeps them 'involved'.
Third, you could get yourself a programme like RoleplayingMaster, where you can put in all the characters into the programme and have it simulate the combat, round by round. Again, you can wait between rounds for players to decide on actions. But you have the added benefits of being able to make 'battle maps', and post them.
