For an iMac, AppleCare is a good investment.
It is not exactly like the old Mac Pro days when we could open 'em up, change gfx, hard drives, clean fans, change CPU's etc at will. Apple consider the iMac a 'sealed unit' to persuade owners to get service done at an Apple Store or a Reseller.
Here in Australia, my nearest resellers, 100 + klms away and 400klms each way to an Apple Store, are very reluctant to try and crack 1012 and late iMacs, and ship them to Apple for maintenance work. Then again the Resellers are also HP agents and often seem only interested in sales.