Right. Don't use that 24" monitor you have, go buy a 24" iMac for $1799 because at $499 to $799 you are getting ripped off.
You're not thinking it out far enough.
In my case, I already have a like-new Dell 2407WFP. I can get a refurb 2.0 mini for it, max out the RAM, and have a decent setup for almost $800.
OR, I can sell the monitor (about $400) and get a $1049 refurbished 20" iMac, max out the RAM, which is a net cost of about $750 ($1150-$400).
The iMac, while less screen real estate, gives me FireWire 800 (uber-fast Time Machining), a full-sized 7200RPM hard drive more than twice the size, dedicated video, a sweet new keyboard (and mouse that I wouldn't use), 4GB of RAM, ability to add second monitor later, faster FSB...
So in my case, which is similar to the OP's, the mini is definitely NOT a good value at its current price point/configuration.
--Chris
PS - That said, if nothing new comes out today I might get a 1.83 mini just to tide me over until I have more options. Still not the best value, but a simple solution.