Hi Katie -- Happy for you that you'll be attending the Festival next year! You won't regret it -- it's a great time.
If you can afford either the Classic or the Palace, by all means go with the Classic. It will get you access to all screenings and panels, with the only exceptions of the opening night red carpet screening & party. The Palace will limit you to the screenings at the two large theaters and the poolside screenings; you'll be shut out of the fun and panels at Club TCM and all the screenings at the 3-5 other theaters involved.
Your top priority right now should be to secure your lodging, if you haven't done that yet. The Roosevelt is already sold out. Nice, centrally-located and reasonably-priced hotels go fast after the dates are announced and you can be left with the very expensive ($400+ a night, like the W or the Loews Hollywood), the dives, or the far-away. It's best if you can book somewhere that is a reasonable walking distance from the venues. Tripadvisor.com can be very helpful to find a place. If you can't find a good hotel in your price range, you may want to also check out vacation rental sites like homeaway.com and vrbo.com.
As far as the screenings go, you're usually safe if you arrive a half-hour or more early. There are a couple of smaller theaters that do fill up from time to time. Sometimes they will replay those films on Sunday, if a lot of people were turned away. Plan on eating some of your meals while in line (McDonald's snack wraps and Auntie Anne pretzel dogs have gotten me through many Festivals!).
Have fun planning your trip! There's usually an embarrassment of riches at the Festival, and you'll be making some tough decisions. But that's half the fun!