I've never played an Ultima game before so please recommend me an Ultima game that's best suited for me and not too hard and a decent story to back it up.Thanks.

The general recommended starting points are your choice of Ultima 4 (my personal favorite) and Ultima 7 - Ultima 4 is older and perhaps a little 'clunkier' interface-wise, so people often find it more difficult to get into, whereas Ultima 7 is more recent and perhaps a little more accessible to a wider audience. Not knowing what you're used to, what you consider 'too hard' and/or your general playstyle, I can't recommend much further than that, but both offer decent stories to back them up, and both are great introductions to the Ultima series.

I suggest starting with Ultima 7. It's the easiest one to get accustomed to if you aren't familiar with the series, and it starts a new plot arc.

Ultima 4 (and 5), while they have their strong points, are so technologically dated that they're liable to be a turnoff unless you got started playing games from that era. However, Ultima 6 took a great leap forward from those two, and it's a reasonable introductory alternative to U7.

The first main Ultima game I enjoyed was IV (though III was not bad, but unbalanced towards grinding for money to buy food). VII gets cited as a good entry point as well and it' supposed to be the best out of the series, but I haven't played VII yet. Keep in mind that VII was meant to be played by people who were already kind of amiliar with the series, so all the content might be overwhelming for a new player. Ultima Underworld is a very good start as well, especially since it takes place in the abyss and thus doesn't expect you to be familiar with the geography.

Personally I'm either for IV or Underworld, simply because their worlds hadn't been established yet at that point, it was new to everyone. You can skip the first trilogy, unless you are curious. Keep in mind that no matter which Ultima you pick, you have to readd the manuals, it was expected from the player, there won't be NPCs spitting out exposition all the time.

I'm going to disagree and suggest that you dive in at Ultima III if you get the chance. While the initial startup is the most involved (but also the most customizable), it's also the most straightforward of the "old school" Ultima games, a kill-the-evil-one quest on par with your early Final Fantasy or Dragon Quest/Warrior games. There's always a clear goal and a clear direction in mind, even if the information you get may be lacking. (it was the old days, you have to explore)
The rules change in U4, and you're expected to be a paragon of virtue; it's easier to get in to from a play standpoint, but the game is a giant puzzle and a lot of "traditional" role-playing aspects are either used to a different end or gone entirely. While I think that IV and V represent the best of the series (and probably the best of the role-playing genre, certainly of their time) they're less familiar in tone and action to players of other RPGs. Neither has a "final boss," for example (not even a puzzle boss like Exodus). So I would check out Ultima III first to get a feel for the lay of the land and the way the games move and act. From there, you might try to get yourself in to the Second Trilogy, where the games are no longer necessarily about a straightforward good vs. evil.

Ultima I and II are outliers. They're bizarre mélanges of just about anything that popped in to Richard Garriot's head that might have been cool. While they're ... awesome, I guess, they're not player-friendly (in fact, they're often deliberately cruel) and they're not easy for a beginner to get in to. They're also kind of aimless and directionless (you have a goal, but the steps you need to take aren't ever really clear) and a lot of the information you need is either presented in riddles or simply not available.

Good luck and happy hunting!

On the topic of Ultima III, the biggest problem in my eyes is the gridinding at the begginning: you eat constantly in this game and you need to keep track of very character's food. To buy food you need money and to get money you have to fight monsters. The only problem is that monsters spawn very rarely, leaving you almost starving while searching for some orc or skeleton to kill.

The easy way out most people took was to go west from Britain to the town of Yew where there are no guards and murder the local druids with almost no resistance. Since towns respawn when you re-enter you could keep doing this all day.

Personally though, I'd just skip the tedious grinding, and use the savegame editor to give myself enough food and experince points.
http://ultima3.ultimacodex.com/the-ultima-1-to-5-savegame-editor/
Oh sure, it's cheating, but it's not like the game isn't being unfair.

Another, less full on cheating, way to get a ton of food and money is to create a party of four. Then move everything from three of the characters to the first. Quit and delete the three you emptied. Create another party of four, and repeat until you have four stocked up characters to keep. Or until you feel you have enough on each character. It's tedious, and cheap as hell, but it gets you started in a good position. This way you're at least keeping within the mechanics of the program, if not the spirit of the game....

I found another way.

There's a dungeon near Britannia (it's in a volcano and I forgot it's name) where there's a treasure chest accessible around ten steps away from the door without any traps to block it. I buy a couple of torches (really cheap items), raid the chest, exit the level and repeat. So far, I'm just grinding for money.

But now, I wonder how much I should save and what should I start with (better equipment, or finding the place to upgrade my stats? And if the latter's the case, how do I access it?)

Spoilers for how to get to stat upgrades, so if you want to figure it out yourself, pick up later.

So, in order to upgrade your stats, you need to get to Ambrosia. You will need to go there anyway for other reasons, but anyway. You get there by sailing a ship into the whirlpool that wanders the oceans. You get a ship by killing pirates that are on a ship. You get pirates to show up by reaching level five. Bigger enemies spawn as you gain in level, and pirates start appearing when you have a character at level five or higher.
Anyway, in Ambrosia you'll find four shrines where you can buy stats for each character at 100 gold a point. It's handy.

***END SPOILER***







Another option for early money is to steal stuff from shopkeepers. Those treasure chests that they have behind the counters can be obtained with a [S]teal command. Fail and the guards come after you, though, so be careful.

As to saving, it happens automatically when you exit a towne or when a character loses his "Good" status (is poisoned or killed). Saving is still a wise thing to be doing. Note also that your save game includes the position of all treasure chests on the overworld map, which is important when you know that monsters can't cross the treasure boxes, allowing you to permanently protect areas of the map you might want to retreat to at some point. This is also handy information if you get into trouble in town and need a spot to hide from the guards.

Finally, for money - in Death Gulch, just south and east of Lord British's castle (you need a ship), there's an armour shop with a huge amount of treasure inside. You can get around back with some clever maneuvring. Once you can get to Death Gulch and find your way there, you should never want for gold again. And I mean that literally. You need one key and the money to bribe a single guard and you get access to twenty-five chests for the taking. If you can get through a force-field, you can collect another fourteen at least - but be aware that shopkeepers will attack your party on sight if you're caught behind the counter, and being attacked will call the guards down on you. They're pretty few and far between in DG, but they're still trouble even for an experienced party.
Murdering Clerics in Yew or trawling the upper levels of the dungeons are good ways to get experience, by the way.

i'm torn on this - it makes sense to a degree, but there's a growing "kids get off my lawn" curmudgeon in me that prefers not to sympathize with the 'jaded youngsters'. :D of course in the final analysis, we can't make anyone have a form of fun they aren't inclined to have. not sure how that's "less full on" than any other form of 'something for nothing' (there is no risk involved in dumping/reforming and not even any kind of record of using, say, a 'cheat-code'), unless you're just making a distinction based on things the original developers would incorporate and/or directly refer to as 'Cheats'.

or we could pick nits and call one column 'Exploits' assuming that nobody deliberately designed them to be taken advantage of (like the collect/dump/reform loophole), and the other column 'Cheats' if it's as egregious as God Mode or +X money from thin air...

Yes, I'm making a distinction between "exploits" and "cheats".