SmartThings “Smart Home Monitor” (SHM) is what I use as my budget security system. I know it has reliability issues and I deal with false alarms. I have original Arlo system too and they both have false alarm issues from my experience. I’ve never used a “real” alarm system but I imagine the trade-off is remembering to arm it every time you leave and having to type in your PIN within so many seconds every time you return. SmartThings hub/SHM does not have a delayed entry PIN type device.
If you are single or everyone have phones you could use cellphone based presence to arm/disarm (it has reliability issues though too). I try to use schedules and the SmartThings Routines to arm/disarm but still not perfect. I got a siren with one of my GoControl kits but don’t have it activate automatically because I don’t want to be nuisance as you described. I could turn it on manually if I knew there was a real breakin.
Regarding the kit vs 3rd party sensors… I generally have stuck with 3rd party (GoControl brand) z-wave sensors and they are very reliable for me (SmartThings branded sensors use Zigbee). I was fortunate to get most of my sensors on clearances at HomeDepot & Lowes. There is a deals group here that I check daily for sales/clearances. Monoprice has some decent z-wave sensor&outlet prices especially if you wait for their sales.
For $170 you could get started…
ST hub $85
Monoprice door sensor $21
Monoprice motion sensor $21
Sengled smart bulb $10
Cheap WiFi camera $30
Then watch for sales and get addicted like the rest of us 