Here are some great instructions as to which parts of your rifle need to be lubed:
http://www.ar15.com/mobile/topic.html?b=3&f=7&t=548967
Oh and here's an amazing video regarding maintenance. If you don't already know:
https://www.youtube.com/watch?v=xW4DQ5QlwrA
Definitely clean down your whole upper receiver. Barrel, chamber, BCG with Hoppe's or some other solvent.
Then wipe dry and make sure there's no factory grease anywhere. Then lube as above.
I use Frog Lube and I find it works really well. Yes, it's really important that you clean and lube a factory rifle out of the box before shooting.
You don't need to do anything to the lower. Keep it dry.
Barrel: Get a good one piece cleaning rod, brushes and jags if you don't have one. You want a good copper solvent like KG-12, as well as a powder solvent like Hoppe's No.9, and any gun oil. I run a wet patch of KG-12 through my barrel, let it sit for a bit, wet a nylon brush with KG-12 and run it through the barrel several times. Then I run a few dry patches. Next, run a copper brush wet with Hoppe's a few times, and dry patch. Barrel should be perfectly clean. Then run a oily patch through the barrel and you're done.
For light shooting and regular maintenance, use a boresnake. But nothing replaces a good rod and cleaning products for a good regular "monthly" (depends how much you shoot) cleaning.
As for ammunition, I personally don't shoot steel through my AR's, I shoot brass exclusively. Try to get some decent ammunition like Federal or PMC .223 bulk.
What brand of AR do you own? If you're running a decent quality American made rifle, then I reckon your main issue is the fact that the rifle may be dirty. Guns need to be well maintained for good results. :)