Whether to replace your old wood window(s) or not is a question that requires answering several small sub-questions. There are many variables that affect such decision, such as the cost of the window replacement, optional repair cost, historic value of the house and its original windows, energy efficiency, and new window influence on house’s appeal.
Based on your description I’m assuming that windows can be repaired and supposedly restoration process would cost less than a replacement with comparable new windows. Just to make sure your carpenter(s) is correct I would ask him for an itemized quote and at the same time call 2-3 Chicago window contractors to give you an estimate on installation of new windows similar to the ones you have. Wood windows will not be cheap and they do require maintenance. If you’d like to go for maintenance almost-free solution you could try aluminum clad wood or the cheapest – vinyl windows.
Search reviews, ask friends for recommendations, you could try EDMAR Contractors (I personally know those guys) for window installation in Chicago. When asking for a quote always request the same contract conditions from each contractor and ask for the same window.
With new windows always look for Energy Star certified for maximum energy savings.
If your house has a historic value with original and reparable windows it would seem reasonable to have them repaired. Although even with the storm windows you will not be able to reach the same level of energy efficiency as with new thermal windows, the outcome of such decision may be well rewarded when it comes to selling your property.
The way your house presents itself with old fashioned or modern looking windows may also be important for you. A new vinyl, aluminum, clad or even new wood window may not have the same charisma as an old, aged, original house window.
Let me know if you have any additional questions, there’s not much about house window replacement on my website but I’ll do my best in answering your questions.