Note: this (Sept '06- July '07) is the longest time ever between iMac upgrades!
Better to borrow (a friend's/relative's second Mac - and many do have a second, generally older - Mac) or hire a Mac for the 4 weeks or so till the stunning new iMacs arrive!
Only in extremis consider buying a "living fossil"
iMac!
Impatience is the mother of regret!
I've tracked iMac prices since late '03 (though only in March/April '07 motivated to buy (I have other Macs): Consider these facts:
November '03: (dome flat screen) iMac 20" 1.25GHz G4; 256MB RAM; 80GB HD; No Airport/Bluetooth or iSight! = $2199.
August '04: iMac 20" 1.8GHz G5; 256MB RAM; 160GB HD; Slot SD = $1899.
May '05: iMac 20" 2GHz G5; 512MB RAM; 250GB HD; SD = $1799.
October '05: iMac 20" 2.1GHz G5; 512MB RAM; 250GB HD; SD; iSight = $1699
January '06: iMac 20" 2GHz Intel Core Duo; 512MB RAM; 250GB; Dual SD; iSight; Bluetooth = $1699.
September '06: iMac 20" 2.16GHz Intel Core 2 Duo; 1GB RAM; 250GB HD;
Dual SD; iSight; Bluetooth = $1499.
Note: the $200 price drop in 9 months (Jan - September '06)
Note: the superior specification; also, students buy Macs before starting degree courses in September - Wait till mid-August! You'll not regret it.
Further evidence for imminent new models: a large UK vendor (Macwarehouse) has had no 20" or 24" iMacs in stock for 4 weeks...