Amazon drops the price of the Rebel XT to $630:
Canon Digital Rebel XT 8MP Digital SLR Camera with EF-S 18-55mm f3.5-5.6 Lens (Black)
Also available without the lens for $530:
Canon Digital Rebel XT 8MP Digital SLR Camera (Body Only - Black)
This is one step above the used Rebel that I bought from Scott and would make a great starter camera for anyone looking at a digital SLR. Don't get caught up in the mega-pixel myth. This will produce large prints just as well as the newer 10MP cameras will. You're better off pocketing the savings and using it later for a cool lens. I'd recommend this 50mm prime for a start.
I've started up a Canon store on Amazon just to see how it works.