Ok, there are a lot of schools of thought here so here we go:
Mouse over vs click casting vs combo: All are great options but will depend heavily on how you play.
I prefer click casting so I’ll address this and addons that support it (most will also support mousovers).
Click-casting support was actually added by Blizzard and the interface is actually pretty good. I currently use this but there are two addons that add a lot of options.
Clique was mentioned earlier and that is a solid choice.
Another worth of consideration is Clicked. This one offers even more options so setup may be more challenging.
Click casting is also mouse dependent. I prefer a Steel Series Aerox 5 but really it comes down to having enough buttons without overkill. I prefer having 2-3 side buttons along with the left, right, and middle (wheel) buttons. Many gaming mouses also have a dpi toggle button behind the mouse wheel. If you don’t need to toggle sensitivity it can also be used as a click casting button.
For the two side buttons I usually map them to the action bar key strokes used for area effect directed spells (things like mass dispel, healing rain, etc).
The rest are up to you and preference. I tend to only like to use shift and ctrl for modifiers. Alt doesn’t work well for me.
The final part of the puzzle is raid/party frames. Again here there are a lot of excellent choices. My personal favorites (in order) are:
Grid2 – I found that mini-icons with tiny sweep timers are pretty useless. Grid2 lets you set up indicators, text countdowns, border highlights etc. Grid2’s setup can be challenging but it is simpler than some of the other options. Grid2 tracks raid debuffs as well but it is off by default. Need to enable it in the settings (usually mapped to a large icon in the center of the frame). Grid2 is complete and doesn’t require additional plugins.
Pexus (used to be just Grid) – this is one of the oldest raid frames replacements. It recently changed ownership (hence the name change). Its basic feature set is very similar to Grid 2. This one will require some plugins, and there are a lot but they are actively supported and supports raid debuffs well (raid debuffs is one of those plugins).
Aptcheka – this one is interesting. It requires almost no setup out of the box so it is a good choice if you want something you don’t want to mess with too much. It use a combination of indicators, bars, and some icons. You can customize it but is pretty darn close to optimal from the get-go (at least for me).
Vuhdo – tried this a few times but I found I preferred the others listed above more. Still its worth a look as it is popular and supported.
Hope this helps!