Mike T suggested MOSS, which is a good product.
However, I suspect that the needs are quite basic, so Windows Sharepoint Services (WSS) alone might just do the trick. WSS is the backbone of MOSS, but is missing quite a few of the features (including workflow). But for basic document management (security and version control), the document libraries in WSS will do just fine.
And the price is right! It is included (for no additional charge) with Windows Server 2007.
To provide some sort of answer to your other questions ...
2 - Domino migration - Don't let the contractor make it your problem. Ask them to provide the docs in a standard format (i.e. RDF or PDF). Worst case, you will need someone to manually put them into WSS. This isn't nearly as much effort as you think, and clerical help if far less expensive than consulting help.
3 - SAP does indeed have a document management system (SAP DMS), and I imagine it works well, particularly for documents connected to SAP transactions. I have no idea of the license and implementation costs, but I would be shocked if they are less than 100 times the implementation costs of WSS.