welcome to projectguitar.com! i just found the site a couple months ago myself, and its pretty awesome.
if you want to replace a knob with a switch, it is a easier but it makes your guitar much less versatile. To redo it with 1 vol 1 tone and the switch in place of one of those, just find a wiring diagram for any other guitar with a similar setup, there should be one somewhere around here. This will make you have one master volume and one master tone, which would be pretty simple to wire.
you'll also need to find a way to cover the hole you'll leave on the top horn. www.warmoth.com sells explorer pickguards, and someone posted an awesome site that sells diamond-plate explorer pickguards. i'll hunt around and see if i can find the link for ya.
to do a new hole for the switch, you'll need to make sure you have enough room in your control cavity for additional wires. then, you would drill a hole where you wanted the switch to go, put it in, wire it up the same way it was before (you will have to unsolder any wires going to it so you can pull those through the long channel going to the horn) and it'll be ready to play.
in either case, you should prolly get a new pickguard to cover that hole. if you're making a new hole in the guitar, then definitely go with a new pickguard.
hope this helped.
now i'm off to go get my own modded explorer from the shop . peace dude.
quick edit: as for the price, if you have a soldering iron, solder, and a drill, your only expense would be the new pickguard, which should be $20-30. (warmoth has a minimum order of $25 rule)