Like vidkid12 says, newplast plasticine is probably the best stuff to go for, if i'm not mistaken, the same stuff is used here at aardman.
Suitable cameras for animation? this is where I get stuck here... At the moment i'm relying on a trusty video camera with the ability to take digital stills. I place the digital stills into a software package (movie maker or premiere elements) and then speed up the clips as desired.
However, there are cameras out there that will record for set periods of time, for example, the SONY PD-170/PD-150 cameras I used on work experiance are professional broadcast quality cameras and so are expensive, but give good detail. These had a feature where you could set the time that the camera recorded to one quarter of a second.
From here, I just put the clips into a software package and sped the clips up as needed.
There are a number of ways you can film stop motion animation, you can even find old film cameras that will take frames knocking about at car boot sales every so often.
I find that it's best to use something you know how to work, something that you're comfortable with. From there, you'll be able to create animations in your own way