I'm giving myself the task of creating a model loader but I'm also interested in animation. I have created a .obj file loader easy enough but now im interested in the animation side, unless I'm mistaken .obj can't do this. I've looked at the MD3 file format but from what I understand this is a vertex animation not bones. Are there any advantages or disadvantages to learning this format? Is there a better, more commonly used format? I'm looking at a more Gam focused format. I dont want to waste time learning MD3 if that went down the bog 3 years ago. I'm also not interested in COLLADA... yet!

Try the Milkshape3D format (*.ms3d), is what I use for years, easy to parse, there's lots of sample code in net.
It uses bones for animation (last version I think that even supports various bone weights per vertex).