Note: all prices are CDN. Suck my teets if you can't grasp the exchange rate.
First, a top of the line computer won't run $900-1050. It'll run $2500-3000. However, it's multi-functional: you can do a lot more then just games. (And if it's an actual PC, you can play a LOT of games. Next time, skip the Mac. :p) As well, you can hook an Xbox controller up to a PC. Though you'd better only do that for a racing game.
My Xbox (four controllers, 3 games, DVD remote) cost me close to $1000. It plays games, and only games. And doesn't play FPS games well. At all. Any gamer who plays FPSs and claims to have some skill better do so on a PC, not an Xbox. They'd get smoked by anybody with a keyboard and a mouse. As a living room entertainment box, it's decent value. As a replacement for a PC gaming platform, it's not. Unless it had a keyboard and mouse.
So, my badly worded point: an Xbox (or any console) isn't exactly cheap, nor can you compare it to a PC. (And you are silly if you do.) If you want to tout the benefits of having a few people clustered around a TV, with four controller, a variety of drinks, and a mad game of Burnout 3, go for it. A PC will never compete with that. Ever. But otherwise, there's no real reason to choose a console over a PC.
ESDF + mouse = ownage.
Ask Jeph.