I'm very new to this so I'm hoping you guys and guide me in the right direction. I want to setup a webserver that hosts multiple sites (about 3 for now). I want my users to have FTP access to their directories only. I want to the websever to be able to resolve to the correct website/account on the machine.

How about starting with Apache? In fact Apache installation is one of the easiest installations Ive done being a newbie. u can check out the apache ftp site and see how it goes..read the INSTALL file...its helpful

Setup apache with virtual domains and create your users for each domain or site. The path of which the domains are served from should be setup as the users home directory as well to make things simple. Then for FTP access, setup something like vsftpd which has the options to chroot users to specific directories, make each user only have access to their home directories so they cannot freely browse other directories on your server.

There are ton's of howto's and documentation covering these types of setups, you should really research to learn more about setting up such a basic server.