We used to have a great thread over at sevenstring.org about this, and it appears the original article (from Harmony Central) is down. Doing a bit of searching, this appears to be the same thing - I'm guessing HC copied it from here, and not vice versa. Anyway, it's a great read:
Acoustic Guitar Recording Techniques
Also, here's another pretty good read - one musician's home-studio approach that, while not exactly low budget, is certainly within the realm of what can be done on a reasonable budget in the confines of your own place:
Acoustic Guitar Recording 101 - Home Recording
A properly recorded acoustic guitar is a thing of beauty, but getting it on tape is no easy feat. Hopefully these will help.