If I were to buy a small set today, I’d probably go with one of the Panasonic Viera line of plasmas. The 42” S1 1080P monitor, for example, is selling for c. $725 on Amazon today with free delivery and no sales tax, a pretty attractive price, and well within your budget.
Plasmas are superior to other display technologies in just about every video performance parameter that can be named. LCDs may equal or surpass plasmas some day...but that day is not today, or even tomorrow.
Making a decision based on what you see in a store (other than in a dedicated high-end emporium where the set has at least a chance of being properly adjusted) is all but useless. Walmart, CostCo, Best Buy, et al., do not even attempt to adjust their displays for maximal quality, so 99% of the time you’re comparing one awful picture to another in the worst environment imaginable.
One of the best $20 you can spend to assure you’re getting the best from your set is to buy a calibration DVD, such as Digital Video Essentials, Spears and Munsill, or the AVIA calibration disc. Although a professional ISF calibration will yield the best picture, many people balk at paying $250-$300 for a techs home visit; the $20 calibration disc will get you close to ISF standards money well spent, no matter what sort of set you own.
For another $20 you can pick up a screen cleaning kit from PhotoDon. Ive tried just about all of the other screen cleaners (from Monster, Allsop, Rocketfish, etc.) and none of them work as well as the one from Photodon. Screens are like magnets for dust and grunge; cleaning the screen every month or two makes a big difference.
Pass on the HDMI cables sold in the stores; you can find some of the best video cables available online at a site called Monoprice, which sells high quality HDMI cables for the price of lunch at McDonalds. Friends have returned their $100 Monster cables to Best Buy once theyve seen one of my spare Monoprices in their systems, for 1/10th the cost of Monsters overpriced junk.
Second your recommendation of Monoprice for cables, adapters, converters, etc. I have been a satisfied customers for years.