Although I don't usually wear wetsuits for ocean swimming, I seem to get asked a lot of questions about them so I thought I would put my advice in one place.
Do you NEED a wetsuit? My answer is "no." My first season and the last two seasons I did the vast majority of my races without a wetsuit and I never felt one was necessary. However, you may not have the same tolerance for cold (or the built in wetsuit) that I have. For new ocean swimmers the wetsuit will give you more confidence. And for fresh water swimming, those of us used to the buoyancy of salt water could be miserable without a wetsuit. One or more wetsuits (I have two) is a good idea for most triathletes.
Wetsuits will make you faster and (for almost all swimmers) a full wetsuit will make you faster than a sleeveless wetsuit. (The reasons are that sleeveless suits allow drag around the armholes and a fullsuit provides full body coverage that has less drag than skin.) You may want both for different temperature conditions, but if you can afford only one, get a full suit.
Surfing wetsuits are not designed for swimming and may actually slow you down. You should explore all the triathlon-specific wetsuits (Orca, Ironman, Quintana Roo, Aquaman, De Soto, etc.) (I own one Orca--a Predator sleeveless--and a Quintana Roo Superfull--but that is just my preference) and pick the one that fits you best and is easiest for you to get in and out of. The more up to date suits use more flexible materials--you will notice this as you try the suits on. (They will cost more and they may or may not be worth it.) You should try the suit on before buying it. It should be a bit uncomfortably tight when dry. The club's sponsor Pacific Tri and Running in Encino and other places like Triathlete Zombies (Santa Monica and Manhattan Beach) Triathlon Lab (Manhattan Beach) and Nytro (Encinitas) have good selections.
A wetsuit will help you deal with the shock of cold water that stops your breathing. But so will an insulated cap. (I like Barracuda Hotheads--in stock at High Point Swim--get an ORANGE one please.) A wetsuit will make it harder to get under the surf. In general it is probably better to get your wetsuit at the beginning of the season and well before any races so that you can get used to it.
The best thing about a wetsuit is that it permits you to continue to swim in the ocean almost the whole year so that you can minimize your time in cement boxes. Most races have water temperatures of 65 or higher, making wetsuits more of a luxury than a need for racing. But as temperatures go lower, wetsuits do become a necessity for ocean swimming. Moreover, everyone's tolerance for cold varies, so for almost all triathletes, a wetsuit is probably the first big equipment purchase they should make after a bike and a helmet. Tom Long