Bag the 550 cord - it's great for tons of things but hammock suspension isn't one of them. You will want some sort of webbing to protect the tree (I'm not a hippie but if you chop up the trees with your thin rope, they eventually they will fall on you and squish you in the night and so forth). From the hammock to the webbing can be more webbing or something like amsteel.
Insulation is another area in which there is a learning curve. You will tend to need more insulation under you than over you. A blue closed-cell foam pad from Wally World is adequate, an underquilt is more comfortable (and more costly typically).
Have a look here:
http://www.hammockforums.net/forum/showthread.php?t=15516 for *much* more info and much better style that I am capable of.
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Beckerhead #42