He's also assuming that you have to buy the extra RAM and HDD space directly from Apple. If you were to, say, buy the hard drives from NewEgg and the RAM from Crucial or DMS or somewhere, you'd save quite a bit of money.
But since he seems insistent on 'proving' the iMac is a better choice than the Mac Pro, let's take a look at two comparable systems:
Mac Pro:
One 2.8GHz Quad-Core Intel Xeon (quad-core)
2GB (2 x 1GB)
500GB 7200-rpm Serial ATA 3Gb/s
NVIDIA GeForce 8800 GT 512MB (Two dual-link DVI)
One 16x SuperDrive
AirPort Extreme card (Wi-Fi)
Apple Mighty Mouse
$2,549.00
Here's a 24" monitor for $329. So the total price comes out to $2,878.
Now for the iMac
24" iMac:
3.06GHz Intel Core 2 Duo
2GB 800MHz DDR2 SDRAM - 2x1GB
NVIDIA GeForce 8800 GS w/512MB GDDR3
500GB Serial ATA Drive
Apple Mighty Mouse
Apple Keyboard (English) + User's Guide
$2199.
So the iMac comes out to approximately $700 cheaper, but with the Mac Pro you get two more cores, a better graphics card (slightly, but still better), far more RAM and HDD capacity, and a better monitor. Fair trade for me.
I nearly forgot to mention: the Mac Pro does have built-in speakers. He apparently doesn't realize that.