The good news is that you can generally do your self-publishing project with open source and free software. I imagine better, paid-for software is probably available, but I’ll leave that for other people to comment – sadly, I’m not in the pocket of Big Publishing (although I would like to be).
In this area, the PC platform is generally better catered for than the Mac.
I’m not here to tell you what software you should use to write your book; for composition I personally prefer Microsoft Word, but you may favour Open Office, iWork or Google Docs. Even though the final format will be simple HTML, you don’t need to write in it.
I will admit that I’ve found MS Word the easiest program to work with for composition. However Open Office writer was also fine. Converting from Google Docs requires a bit more work, but in some circumstances the advantages of Docs may outweigh the downsides – for a multi-author collaborative project, or if you’re working on your book using more than one computer or device.
All these programs do offer the facility to save to HTML, but their HTML output is overly complicated, difficult to understand and requires cleanup. Therefore I suggest you ignore this feature.
The important thing is to stick to writing text and not to worry at all about formatting. If you have any pictures or tables, leave them out of the document. Don’t bother with tabs, line breaks, section breaks and indentation – keep it as simple as possible.
Many people will have chapters as separate documents, which is fine for composition: however, the final version will need to be one long document. Rather than copying and pasting, it might be quicker – in Word – to open a new document and build it up using Insert > File.