I've been doing some research on lighting, and I've learned tons about lighting temp, lumens, color and $$$.  From what I could understand there are two ways you can install lighting on a tank, one is to purchase a pre-fabricated fixture that matches the size of tank and simply install it.  Another route is to install a 'retrofit', where you install the ballast, plugs, lights and fans.

From experience, which is the most economic way to go?  I've heard that some people have been able to find these parts at local shops for a fraction of the cost you would get at a LFS.  Is this true has anyone successfully done this... if so is there a guide or something that would help in the purchase and assembly of parts?

Sure.  I've gone the local shops route many times. 

For comparison:  I just set up the lights on a 72 gallon tank with 2 x 250 watt MH and 2 x 48" VHOs with endcaps, sockets, reflector, ect (minus the bulbs).  For $220.  All from local electrial/lighing stores.  It takes A LOT more work but can save money (if you don't value your free time much).

From experience, which is the most economic way to go?
It depends on what you want.  I really like the look of Spacelights from Aqua Medic.  For a 48" one, it could cost from $700-$900.  To retrofit the same thing; $200-300 nice canopy, ballast, $100 for ballast, endcaps ,and wiring for 2 P.C.'s; $200-400 for two 150-250 watt HQI MH bulbs, ballasts, and reflectors; $20-40 fans.  Depending on the quality of stuff that you want, retrofitting could cost as much as buying a fixture.  There are a lot cheaper fixtures made by Custom SeaLife and Helios.  But they do not have Halides.  But fixtures do not always look good without a canopy depending on what the top of your tank looks like.  You can alo buy complete retro kits that have the bulbs, endcaps, wiring, reflectors, etc... and you can screw it right to the top of you canopy (underneath of course).

I've heard that some people have been able to find these parts at local shops for a fraction of the cost you would get at a LFS.  Is this true has anyone successfully done this... if so is there a guide or something that would help in the purchase and assembly of parts?
You can get Fullham ballasts from Commercial lighting.  You can do almost everything with these ballasts.  You can get reflectors from metal shops too.  You can get wiring from Home Depot.  You can get fans from Raelco (I don't know hwo to spell it).  So to sum it up, yes you can buy things at other places.  but you have to know what to look for.  You have to get bulbs from LFS or the internet, though.