I started building my solar water system from Gary's plans a little over a month ago. All in all, the insulation isn't really the most expensive part. On my list, the 2" poly-iso is about 3 or 4 down from the top as far as price goes.
In my opinion, you will be best off with at least some sort of hard board insulation that won't compress from the weight and pressure of the water (thus losing its R-value and risking breaching the liner). Sure, poly-iso is a little pricey (I spent about $95 to line my tank with 2"), but i think its worth the investment. In fact, If I could, I would go back and get 3" board instead of 2". In all, my 4'x4'x4' tank will cost around $450 total. $90 or so for insulation isn't so signifigant that its worth skipping on to save a few bucks, IMO.
Good Luck!