Myth #4: An editor is an editor — so I should just find the cheapest one I can.
It’s your work and your money; you should budget what you can afford in order to create the book that has the impact you’re looking for. As I mentioned above there are different kinds of editors who have different skills, and different kinds of editing demand different commitments of time and energy, so cheap isn’t necessarily better. I’m going to charge a lot more to do a long-term, deep, developmental edit (where I am working with the author to improve the manuscript at the fundamental level) than I will for a simple just-before-publication proofread (where I’m just looking carefully for punctuation, grammar, and style issues).
In addition to marking it up, a good substantive or developmental editor will make lots of queries (questions for the author) on the manuscript, where a copy editor will mostly clean up the language as-is, and a proofreader is usually purely focused on correcting any errors of usage or formatting. These are different approaches to your work.
As with any other service, you get what you pay for.