If your budget is $1000, what is stopping from buying a new laptop? I recently purchased a Compaq laptop at Futureshop during a winter sale at $799CAD ($910CAD after taxes) and it works great! It has a 120GB HD, which is fine for everyday use storage, and for my multimedia I have a portable 250GB HD.
Something else you can try is either eBay for parts and for the OS
If you're really into Windows, you can buy it at a OEM price, just ensure you buy it at the same time as your hardware. But like many people said here, big chain dealers like Dell and such paid a distributor fee that allows to sell boxes with Windows for cheap.
You could do averatec they're affordable, I wouldn't consider it a long-term replacement, but definitely a good buy if you take care of it, and don't mind it crapping out in four years (I think four years for a laptop is very decent). Just don't get a refurb if the price difference is a couple hundred (unless you don't have it). good luck guy.
Sorry for the delay in a response. My health has taken a dive...fighting some aggressive sinus infection. Quick response though:
I do not plan to use Vista in the near future. It uses too many system resources and isn't compatible with a lot of stuff. I plan to dual boot XP and some distro of linux - XP will be for running games mostly.
I have been looking on newegg and tigerdirect, and they seem to have some extremely good deals!
More detailed response to come later....thank you everyone for your replies.
$1000 for a DIY budget is impressive. Places like Tigerdirect and Newegg are good sources. Anything you build will be better than DELL and HP. Make sure you have a good stable power supply and maybe an extra fan. As for operating system, get rid of bloated Windows and download PCLinuxos and a copy of Crossover and\or VMware which lets you run Itunes and other specialized software on the beast. You screaming baby!!!