hey,
I have seen some good results with feedburner, it’s quite simple. But if you want to go your own root once a week I would say would be a max, it depends on how active your users are, but keep track of the unsubscribe rate and try to use the newsletter as a real selling and referral (get them to pass the newsletter on) tool.
Newsletters don’t have to be lengthy, a well written hot article (with a catchy headline) with a few links to some of your key buying pages should do the trick, then play around to see what works. If you can I would try to get the links tracked so you can analyze the metrics.