Brilliant.
I have a yogurt maker at home but am interested in learning alternative ways, so your styrofoam cooler/garbage bag/hot water idea is great. Also, for folks without yogurt makers and who don't want to do the cooler thing, I have it on good authority (ie. other folks who do this) that one's oven, with the door propped open so as to keep the light on, will provide enough heat to properly incubate yogurt. Just be sure to check the temperature.
For myself, I use goat's milk and a nondairy starter. I don't tolerate cow anything very well. I ferment the yogurt for 28 hours - 24 is enough to eliminate the majority of lactose. (Yes, so those who are lactose intolerant can even enjoy properly fermented yogurt. Additionally hard cheese is also very low in lactose - if it has been properly cultured.)
It is also to be said that one can make yogurt from almonds, or ferment vegetables to get the same probiotic effect. Google them as I am no expert in these processes
