How do I create--and use--an HTML template using an HTML editor in which I type the code myself (such as notepad or TextPad, etc)?

For instance, if I wanted a banner to be on every single page of my site, how would I create the banner template, and what code would I put in the pages to reference the banner code?

sounds like you want to get into "includes".
you can check into using SSI or PHP for that.

step 1 = design your page like normal.

step 2 = slice out the repeating parts, put them on a seperate page, enter the coding to re-insert them into place when the page is viewed.

Should the repeating parts be saved as some special file type, or will .htm work? I don't know anything about SSI or PHP.

depends on what direction you go in. both have different extension types.

do a quick search on site or google to find many many tutorials on SSI or PHP includes. it would be extraneous to explain it all in a posting.

Will do! Thanks for the help.