Cheaper if you just buy the parts you want and put it together yourself (quite easy to do, honestly).

If you want a system-wide guarantee and you're not to tech savvy buying a premade one may be a better option. I did the same as goat and just built a killer rig for 1/2 the price of a commercially made equivalent.

It's well the average mid-range PC nowadays (and better than mine!) but I wouldn't recommend buying a PC till later when the Geforce 9 series fully comes out. 8800s are already falling in price, so when the 9800 comes out, they'll be like £90-£120 instead of £140+
I would recommend going for a specialist gamerrig shop and get one custom built. It's much cheaper than getting a factory made one because it doesn't have crap like MADE-WITH DELL TM COPYRIGHT over it, and trivial stuff like the case can be changed for cheaper ones. By changing the case for my PC from it's recommended to a cheaper one, I managed to fit in another video card and get me that cool cool SLI action.

Eh, that's not a bad price, but when it comes to customization there isn't much room.
And I wouldn't wait until the 9800 series unless you're really a hardcore gamer. The 9800GT isn't going to be that much more powerful than the 8800GT(at most 25% more powerful), and it's going to be priced about $100 more. If anything, I would pass right over the 9800GT and get a 9800GTX2(probably twice as fast)

But yeah, that isn't a bad deal if you're not into overclocking, SLI, etc. Personally, I like to overclock the shit out of my products(got a q6600 @ 3.4ghz), and that requires good cooling and a good case. I would build my own PC if I were you, it really isn't that hard. But if you don't feel too confident about it, you can always have somebody do it for you.

Edit: Oh god that shit comes with a 400W power supply. :x

That's a very nice PC for someone who doesn't know how to build a PC from single components. The price isn't that bad and 400 W should be enough for that system. It should play all modern games easily with high eye candy and smooth frame rate.

FUCK TECHNOLOGY. I got a PC for that price (screamin deal) that's half as good about two years ago. Seriously fuck technology, everything gets outdated so fast it's not fair

factory pcs are great if you want to put games on it and play games on it. they only let down HARD CORE GAMERS who like to PUSH THE LIMITS and tinker with their toys

Yes, that letdown couldn't possibly be from overpaying, or not getting the parts you wanted, or paying for parts you don't want, or having horrible tech support thats factored into the already bloated price tag.