That's a fair (as in good value) price. Check to see if it has AppleCare if so that is valuable too. Finally any software he is including MUST repeat MUST include the original media. If he can't produce the original media walk away, BTW that also includes the OS X Install discs that came with the machine.
I'm just wondering since I can get a 21" for a little more would that be a better option? I don't really need any of the software. Also figure 4 GB of memory and 500GB HD would be plenty for my use.