I look at it this way. The best deal is the baseline 2.4GHz 24" iMac for $1,799.
Now, just go out and buy a 2G stick of RAM for ~$130 and you're all set at a total of 3Gig system RAM. Total outlay $1,929 before taxes.
However, you could just pay an additional $250 for the CPU upgrade to the baseline 24" iMac. i.e., $2,049 for the faster CPU and 1Gig RAM.
You're right it's either $250 for the CPU for $250 for memory upgrades. Sure you could spend that money to get 4Gigs of RAM, but then that's not a cost effective upgrade when compared to buying just 1 stick of 2GB memory. Why? Because that makes your current 1GB stick useless.
For me it would be between the following two choices. BOTH presume that memory will not be purchased from Apple.
A. $1,929 for 24" 2.4GHz, 320G HD, 1 G RAM, + extra 2GB RAM
B. $2,049 for 24" 2.8GHz, 320G HD, 1 G RAM, (extra memory to be added when funds are more abundant).
That makes a difference of $120 between choices A and B. I would go with B and then buy the extra memory a day later.