The Engadget guys have a quick tutorial for building an HTPC for under a grand.

Though I would have chosen a few different parts (such as HD tuners and gaming graphics card(s)), this is a great read. (My choices would have also boosted the price way over $1k.)

We wanted to build a machine that had:

* Good desktop performance
* Long life through upgradability
* Cost close to $1,000

Tutorial: Build a practical HTPC