The imac has been $1300 and "all-in-one 'cute'" since 1998, but doesn't sell like it used to. Reason: cute only goes so far in covering up a price/performance gap.
The gap didn't really exist in 1998. It's yawning huge now. Look what $1000 will buy you in the PC world now:
http://www.sharkyextreme.com/guides/MVGSBG/article.php/3394901
If you don't feel like reading it, you can get put together a complete Athlon 64 3000+ or P4 2.8E system with 512 MB RAM, Radeon 9800 128MB, 80 gig HD, combo drive, 19" flat CRT, 5.1 speakers, mouse, keyboard, etc for $1000. Replace the $185 19" CRT with a 17" LCD for $400 and you're still under the lowest of the low-end imac.
Such a system will absolutely spank any Mac short of a Dual 2 GHz G5, up to and including this new imac. Total performance humiliation. Yes, the PC will be big and ugly and run windows or linux. It'll also be expandable and fast.
Look, I hate to rag on Apple - I'm a huge MacOS fan and long-time Mac owner. I just wouldn't feel the need to trash Apple if they'd stop crippling their consumer hardware.
I simply feel that a 64 MB GeForce 5200FX has no place in a premium computer. I'd be willing to overlook it in the $1300 imac if the $1500 and $1900 versions came with something better - but they don't.
Frankly, I'd also be happier with the guts of the 1.6 GHz G5 imac in a headless case with an agp slot for $1000. I don't need another monitor.
-vga4life