For $1000 you can easily get a core 2 duo system. I would go with a 6550. Oh, I guess i should throw in that I'm a system builder and I do it for a bit of an income so I am current and updated on everything. I would also get a motherboard with a P35 chipset and the seagate 7200.11 500GB hard drive.
Now then, a fews words of caution.
NEVER get a "$15 600 watt power supply" A power supply is one of the most important parts of the system. Spend around 100 bucks on this. You'll need between a 500 and 600 watt one. I like the brands Seasonic, Rosewill, Thermaltake, FSP, and OCZ for that.
Get no less than 2GB of RAM. Look for either CAS Latency 4 or 5. It is extremely important to make sure your memory is compatible with your motherboard. Your motherboard manufacturer's website will have a list of tested RAM on it, chose from that list. I like to use Gskill, Corsair, OCZ or Kingston.
Motherboard brands. I love Gigabyte, but Asus, Abit, and Epox are good as well.
As for video cards, if you get an ATI card use HIS. If you get an Nvidia card use BFG. If you don't want to spend the money on those then go for Sapphire.
The rest can be whatever. Do research, read reviews. No, not those reviews on newegg. Google something like "Seagate barracuda 7200.11 Hard drive review."
As to where to get them, go for Newegg. they will almost always have the best price. IMO Frys is overrated. they go cheap on some things and real expensive on others.
One last thing, Don't try to cheap out on parts. If anything, just click on the top sellers link in Newegg and those will be generally good for what you want. Really cheap things are most often pieces of crap and will only cause you problems. Hope all this helped. Also, you can go to a forums to get better help than this. forums.techguy.org will give you tons of input, and it will actually be useful.