Branching should not be necessary your the day-to-day work. Just have everyone work on the files in the main source directory. It may be clever to move the code to a subdirectory (for example "/trunk") so that you can have other directories in the root as well (a directory for branches for example).
Conflicts will happen when you develop, but they should be small and easily resolved. Commits should be as small as possible. TortoiseSVN has a good user interface for resolving conflicts when you commit.
The only time you must use a branch is if two or more developers work together on a feature that cannot be committed to the trunk, for example if it is not ready to be released in the upcoming release and is scheduled for a later release.
A good time to create a branch is when you release your application. Create a branch called 1.X for the first release. Then continue working towards 2.0 in the trunk. In the 1.X branch you can build a 1.0 release, and also later a 1.1 release and so on (without disturbing the work towards 2.0 in the trunk).
Note the difference between these two types of branches: the release branches are forked from the trunk and live forever. Individual bugfixes can be merged between the trunk and a release branch, but the release branch is never merged back into the trunk.
In the feature branch, trunk changes are continously imported by merging. When the feature is complete, the entire branch is merged into the trunk, and the branch isn't used after that.
Release branches __testing_1.X__..._rel_1.0___.._rel_1.1 ___2.X_branch_
/ /
___________trunk__________/_______trunk______________________________/____..
\ /
\_____really big feature for v2 only__________/
Feature branches
For day-to-day development you can use branching as much as you want. One option is one-branch-per-feature, but you will probably find that this creates more problems than it solves for a small team. Resolving conflicts in SVN is usually much easier than managing several branches and performing many merges. In other version control systems (for example Git) the situation is different.