I've been contemplating building a new rig, as my current with is getting ancient, and after running some numbers through Newegg, I found that's it's possible to get a decent editing/gaming rig for sub $500 usd (excluding monitor, speakers, keyboard, os, etc. the minor stuff.)
Total came out to around ~450 ish after rebates:
Intel Pentium E5200 Wolfdale 2.5GHz 2MB L2 Cache LGA 775 65W Dual-Core Processor - Retail - $70
GIGABYTE GA-G31M-ES2L LGA 775 Intel G31 Micro ATX Intel Motherboard - Retail - $53
OCZ Blade Series 4GB (2 x 2GB) 240-Pin DDR2 SDRAM DDR2 800 (PC2 6400) Desktop Memory - Retail - $37 after rebate
ASUS EAH4770/HTDI/512MD5 Radeon HD 4770 512MB 128-bit DDR5 PCI Express 2.0 x16 HDCP Ready Video Card - Retail - $99
CORSAIR CMPSU-400CX 400W ATX12V V2.2 80 PLUS Certified Compatible with Core i7 Power Supply - Retail - $40 after rebate
Western Digital Caviar SE16 WD6400AAKS 640GB 7200 RPM 16MB Cache SATA 3.0Gb/s 3.5" Internal Hard Drive - OEM - $60
COOLER MASTER ELITE 335 RC-335-KKN1-GP Black SECC Steel ATX Mid Tower Computer Case - Retail - $40 after rebate
So after rebates, and before shipping and tax it comes out to...$400, which is really really good. The key here is the video card, the Radeon HD 4770, which is probably the best bang for the buck video card right now. You should be able to run any modern game at decent frame rates @1680x1050 with that card, including Crysis. That means all Source/Orange Box games will run extremely smoothly. If you need a monitor, just add a cheap 21-23" at Newegg for another $150-$160. Operating system another $100 or so. The only problem is that stock is low at the moment (for the 477.) I'm guessing supply is low and demand is high I guess. If you're willing to wait for one of them to be in stock I'd highly suggest you pick up that card. If not you could probably spend $30~$50 more and grab a 512mb 4870 like this one:
http://www.newegg.com/Product/Product.a ... 6814161268
Actually, if you want better gaming performance, I would suggest the 4870 as it's not much more expensive (that one at least). If price is more of an issue I'd stick with the 4770.
As far as building it goes, it's definitely not very hard. There are many guides on the internet dedicated to helping you build a PC, so it shouldn't be a problem finding one. If you still don't feel comfortable, ask one of your tech-savvy friends to help.
If you're feeling adventurous and want even better gaming performance/encoding times, then you can always overclock your CPU. This topic is a bit more advanced, but as always, a lot of info on the web on that if you wanna look into it. If you do it right, it's extra performance you don't have to pay money for.
TLDR; you can get a really good gaming/editing PC for less than $500-700 usd if you build your own. Core 2 e5200 is the best value cpu, a good step up would probably be the
Phenom II X3 for $140, good gaming performance and one more core for better encoding times. Best value video card would probably be a Radeon HD 4770, cheap 4870's are a really good runner-up. And with those setups you should have no problem running Orange Box games.
If you want more info on budget PC setups, check out this
guide