I have a Nikon D70 I purchased used for $500 last year and I have to say that I am very happy with the purchase. pictures can be shot in RAW format and compressed to JPEG in your PC making for much higher image quality. The D80 can be had in the neighborhood of $1K, but I think that I would probably go for a nice used one and get a second lens.
Here are a couple of shots taken with my Nikon;
Shiny Side Up!
Bill