Dells are good if you dont have special needs, like overoclockability and good gaming performance. If you do have those needs, then build it yourself. Building it yourself is best for any specialized system. For budget, go with Dell or some other pre-built. $1200 including monitor? what size? do you get charged tax? will you be buying from newegg?
How about this:
$200 - ViewSonic Q19WB-2 Black 19" 5ms Widescreen 16.7M colors ($40MIR)
$185 - Intel Core 2 Duo E6300 Conroe 1.86GHz
$105 - Biostar TForce965PT, LGA775, Intel P965 Express
$240 - Patriot eXtreme Performance 2GB (2x1GB) DDR2-800 PDC22G6400LLK ($50MIR)
$175 - HIS Hightech H195PRF256DDN-R Radeon X1950PRO 256MB ($20)
$75 - WD Caviar SE16 WD2500KS 250GB 7200RPM SATA300 16MB Cache
$60 - Sunbeam NUUO SUNNU550-US-BK 550W PSU
$45 - Cooler Master Centurion 534 RC-534-KKN2-GP
$40 - Scythe SCNJ-1100P 120mm CPU HSF
$30 - Lite-On 16X DVD±R DVD Burner Black SATA SH-16A7S-05
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$1155 + $95 (tax?) + $35 (shipping) = $1285 - $110 (MIRs) =
$1175
The CPU can be OC'd to 3.2Ghz with that cpu/hsf/mobo/ram. The RAM uses Micron ICs, so they should be able to OC very well. The Biostar can reach 505+Mhz. The E6300's are avg'ing 3.2Ghz. The X1950pro will drive the 19" LCD very well. If you want DX10, I'm afraid you'll need a higher budget until the lower end DX10 cards come out. The case has good airflow with 2x120mm fans. The PSU is made by Andyson, so its a good solid unit; there's a review on it over at jonnyguru.com, so check it out if you're leary. If you can wait, do so. New Core2Duos will be coming out at the end of April, along with price cuts. By then, the R600 will be out and NVIDIA's lower end DX10 cards as well.