Thank you nkedel for the most comprehensive and the most useful response covering almost every issue. I too came up with a price around $600 if I built one myself although the specific choice of motherboard etc were different from yours.

I did order ZT Affinity 7362Ma for $700 from Costco. It came with AMD Phenom II 965 with 1 TB HD and 8GB of DDR2 memory. I wasn't happy with the fact that it had DDR2 for the reasons you mentioned, but I was tired of looking. I also did not have to have that fast a processor or that big a hard drive, but I did not have a heart to kill my son's joy.

Anyway the PC arrived last week and worked fine for 2 days, with no more than an hour a day of use. On the third day, I was going to turn it off to disconnect it from the monitor so that I could find a way to adjust monitor's tilt. When I shut it off, it told me that it was updating java and whether I wanted to stop the updates. I told it to go ahead and finish the updates and then shut off. After that it did not boot up. It recognises the optical drive, all the USB peripherals, but no hard drive. So I called COSTCO to send me replacement. They suggested that I call for repairs. I was furious, I don't expect something to to die on the third day of sparing use. Cosco said they don't have anymore, probably ZT stopped building that configuration. I saw another model at cosco that was similar, but had a 2 TB HD and 8gb DDR3 memory (don't know the speed). I am shocked at how many manufacturers will say quad core cpu, without giving any specifications and say 8GB RAM without specifying whether its DDR2 or DDR3 or its speed. I am sure it has a different motherboard. It was priced exactly the same but without the $100 rebate. I convinced them to send me that one at the same price as the one that was bad. I returned the bad one today.
You have almost convinced me to build one with my son. My only worry is how to install the OS. In the old days, you booted through a floppy and loaded some files such as mscdx.exe through a floppy so that the system would recogniose your optical drive through which you installed the OS and drivers. I don't know what's done now for the PC to recognise the optical drive when you build a system and install a virgin HD on it. Lot of stuff on the internet offering help is rather sketchy or oudated. One talked about using a floppy drive to install drivers even when talking about XP. PC's have not come with a floppy for a long time. I think by the time Windows XP came pout, floppy drives were obsolete. Once I am sure I can install the OS, I will build one. Boot order in BIOS, by default, is the optical drive, followed by the hard drive. Does that mean that as soon as I turn the pc on, after going throguh POST, it will recognise the optical drive without having to install file such as mscdx.exe?

Thanks so much for your post nkedel. BTW, have you got any Delaware connection?

For most systems it's much easier now: turn the system on, configure the BIOS to boot off the CD (if it's not already set to do so), put the CD in the drive, reboot and you're good 9 times out of 10 on Vista or Windows 7 unless the system has fairly non-standard disk hardware (ie some hardware or "hardware" RAID.)

Even where a disk controller driver is necessary, it should be able to boot into the installer from the CD.

If by some chance it has a disk controller that's not supported out of the box, 7 can read drivers off of USB flash drive or CD (and I believe Vista can as well.)

For 7, there's also a free tool from Microsoft that you can use to put a bootable copy of the Windows 7 install CD onto a flash drive: http://store.microsoft.com/Help/ISO-Tool
which is very, very handy for installing to netbooks, and installs a bit faster than a CD would even on most laptops (not sure about on a desktop with a faster non-slimline DVD drive.)

On XP - although I cannot in good conscience recommend that anyone run Windows XP these days, especially on a new machine - out of the box with a retail copy from Microsoft[*] it will not come with the disk drivers needed for the AHCI standard used by the SATA controllers on most machines from the past 3 years. There are three alternatives for addressing this:
- use nLite or a similar program to create a bootable copy of the XP DVD with the disk driver added
- use the "press F6 when booting and insert floppy disk" method (I'm not sure if this is still doable with USB floppies)
- change the controller mode to be compatible with older software in the BIOS (not sure if the very newest boards support this, but ICH10-based ones from less than a year and a half ago do.)

[* some manufacturers copies will. ]

For XP, there will also be an issue with using it with a few of the newest hard drives, which use 4k sectors rather than the traditional 512b ones, and ditto for using either XP or Vista with some SSDs.

Pretty much, yeah - they were still pretty common if not used very much.

That's correct - the BIOS will recognize the CD (usually even USB external ones), and as long as the OS can see the disk controllers at all, the OS will recognize the optical drive without any further support being needed as well.

Not beyond having driven through once or twice; I'm an expatriate NYer, in the San Francisco area for values of these days pushing 15 years now.

Update
 

After being forced to return two PCs from I had bought from Costco (ZT Systems), I decided to follow nkedel's advice to build one. Here is the configuration: I had placed the order around Thanksgiving. THE OS arrived while I was in HKG. I was home for 2 days and then had to leave again for two months. I would have given the update sooner, but for my travels.

1. Gigabyte GA-880GMA-UD2H Rev. 2.1 (with Sata II, US 3.0 and HDMI) $99.00 with a 10$ back in the form of a gift card.
2. AMD Phenom II X6 1055T ($179)
3. G.SKILL Ripjaws Series 8GB (2 x 4GB) 240-Pin DDR3 SDRAM DDR3 1600 (PC3 12800) for $99.99
4. LG Optical drive with Light Scribe support- GH22LS50--$16.99
5. Samsung 1TB (5400 RPM) F@ series HD103SI-- $49.99
6. Rosewill FB-02 Case-$17.99
7. APEVIA ATX-JV650W 650W ATX12V / EPS12V SLI Ready CrossFire Ready Power Supply --$29.99 ($54.99 minus $25 mail in rebate)
8. IMC FX-087 All-in-one USB 2.0 Card Reader
9. Rosewill RNX-G300LX IEEE 802.11b/g PCI Wireless Card

I am using a Samsung 21 inch LCD monitor.
I had ordered Windiws7 Home Edition Premium, but it was out of stock. The vendor offered me the professional edition for the same price.
I put it together on the last night before my two month long trip. I must have forgotten to validate the OS. When I came back, my wife told me that something is wrong as there was a message on the bottom right corner suggesting that my copy of Windows7 might not be genuine. My son informed me that the USB ports did not work on the back. The ones on the front worked. I validated the OS. ALl the USB ports, except the USB 3.0 did not work. I was tootired to deal with it right then. The next morning 13 yr told son, with whom I put the system together that the USB 3.0 ports worked too, He had downloaded drivers for USB 3.0 (duh).

With 15 Mbps internet connection, and a fast PC, he is happy, and that makes me happy. It's quite fast.
Thankk you all, especially nkedel for your advice,

Very glad that it's all worked out well!

Congrats Yaatri on your 1st build pc. I used to build pc, but now, I've been spoiled by mac. :D