Step 1: Parts and tools
I paid a visit to my local bike shop (here in the ghetto) to see what it would take to make my old bike's fork better. The bike shop guy said that I had an older 1-inch (25.4mm) threadless headset (as opposed to a threaded headset), which would make replacement very difficult since new MTB headsets are all 1 and 1/8 inch (28.6mm). I did some research and found a manufacturer that still makes MTB forks that fit a 1-inch threadless headset: RST.
I know that RST makes forks that many MTB riders consider as "entry-level" (being generous), but let's face it - my bike is 15 years old, and the technology in a new RST fork, compared to what I have, is like voodoo. Besides, RST has been around for so long and sold so much product, that they have probably managed to get a good product or two out the door by now.
The deal with the RST forks is that they can be purchased without a steerer tube, and you just order the steerer tube that fits your bike. To find out where to purchase these forks and their steerer tubes, just Google on "RST no steerer" and choose from those retailers. There are usually three RST products you will find with no steerer: The Capa, the Neon, and the Gila. The Capa is advertised as a Sport/Kids product, the Neon is advertised as more of a city/trekking (dirt road) fork, and the Gila is advertised as more Sport Cross Country Trail fork. I decided to get the Gila (although the Neon may have been a better choice, for reasons I will get into later).
I am keeping the cantilever brakes, since upgrading them will require changing the brake levers, which will require getting new shifters (since the brake and shifter levers are integrated), and so on until half the bike is replaced. My goal in this project is to keep as much original equipment as possible to keep costs down - this is the ghetto.
The parts you will need to get will depend on your headset size. You should remove the top cap from the stem and measure the diameter - ordering everything and then finding out it's the wrong size will ruin your day and take two weeks of re-ordering and delivering to correct.
You will first need to order the fork, steerer tube, and starfangled nut for the steerer. If there's a choice, get the longer steerer tube (265 mm) to give you some freedom for adjustment. As for the star nut, you can get the nut by itself, or get a 'headset kit' that consists of the star nut, bolt, and stem top cap (these are usually listed in the "headset parts" area of the website, even though we're replacing the fork, not a headset). I got a headset kit and a spare star nut just in case I had a problem installing the star nut, but I didn't end up needing it.
So, start by getting these parts:
RST Gila T9 26" Fork, No Steerer
RST Steerer 265mm 1" 25.4mm (or 1-1/8 in 28.6mm) threadless
Star-nut, Bolt and Nylon Cap (Headset Kit) for 1" (or 1-1/8" ) steel steerer tube
In addition to the fork parts, you will need these:
Tektro Front Brake Cable Housing Stop
Replacement brake and derailleur cables
a metric M6-1.00 bolt, the longest length available at the store
a metric M6-1.00 35mm hex-head bolt (or M6-100 20mm allen-key screw if you use a Neon fork instead of a Gila)
If you are going to experiment with ride position and different handlebar styles, you should also get:
Two or three Headset Spacer Kits to fit your steerer tube
A long, adjustable-angle 1-1/8-inch threadless stem with a 1-inch handlebar clamp
RST 1-inch to 1-1/8-inch steerer shim to fit the new stem to your steerer tube (if needed)
Handlebars with a 1-inch center to fit the stem
New grips (probably need those anyway)
metric allen key set
jeweler's screwdriver, flat-bladed
scrap of 2x4
15/64 drill bit
hacksaw (or jigsaw with metal-cutting blade)
half-round metal file