Our new Michigan home had an old, two-story carriage house. It was built back when 2x4s were 2" by 4", there wasn't a square corner on it, it was dark, drafty, uninsulated, the roof leaked, and it was freakin' cold when winter winds started to blow. But, the downstairs had plenty of room for bikes, a shop for me, a potting area for Mary, and the upstairs had lots of room for storage.
The house needed a new roof and siding, and we decided to give the garage the same treatment. So, we sided it with vinyl over blue-board, and replaced all the old-broken-down windows. That keeps the rain out and cuts down on the drafts.
Over the summer, my Dad and I will finish insulating upstairs and down.
Ironhorse, in a triumph of understatement, suggested that if I was going to be working with gasoline, I should look into direct vent units to avoid a "rapid expansion." He's an HVAC pro, he knows about these things. As he explains it, direct vent units have sealed combustion chambers, they pull intake air from, and exhaust to, the outside. I ran nat gas from the house, installed a Detroit Radiant LS heater downstairs, and for the upstairs furnace, I took GregO's advice and installed a Modine Hot Dawg ceiling hung unit.
That radiant heater is sweet. It warms the floor, the bike, my tools ... And, it's quiet! Got both of 'em on thermostats so's I can turn it down somewhere north of freezing when I'm not occupying the man-cave.
Snarl was concerned less I neglected wiring and lighting. We put receptacles everywhere we might need em - across two circuits, relocated switches to where they made sense, and hung 8' low-temperature fluorescent fixtures.
I built benches for my shop, and for Mary's potting bench, hung pegboard, and started getting tools organized. I need to finish putting up shelves and insulation. I'm putting plywood up vice wallboard. Need to put flooring down. Might put a deep sink in. Shirley need a beer fridge! Tis nice to go out there on a cold morning, turn on the lights, crank up the heat, crank up the tunes, and get into the bike.