I imagine the biggest problem you're having is keeping up volume-wise with the drummer?


First thing's first -- get your [u]guitar[/u] amps up off the floor; the sound they produce will carry better and you'll maybe even be able to turn them down a bit (bass carries better on the floor).

Next, a PA, even a small one isn't a bad idea. You'll probably want your speakers up off the floor and it will be a little tricky to get them oriented so that you can hear yourselves and they're not feeding back. For practice, you'll probably only want to mic the vocals because you should be able to get the guitar and bass amps loud enough to handle a small room, even in spite of a drum set.

Also, I think you may be on the right track with your headphones idea, though I would look specifically into in-ear monitoring systems.