If youre on a budget but image quality is really important to you skip Canon and Nikon and go for the Pentax K-x. In tests it performs better than the Nikon D3000 and about equal to the D5000. See the comparison
http://www.dxomark.com/index.php/eng/Image-Quality-Database/Compare-cameras/(appareil1)/331|0/(appareil2)/320|0/(appareil3)/345|0/(onglet)/0/(brand)/Nikon/(brand2)/Nikon/(brand3)/Pentax
The K-x performs better than both the Canon XS and Xsi. See comparison here
http://www.dxomark.com/index.php/eng/Image-Quality-Database/Compare-cameras/(appareil1)/268|0/(appareil2)/185|0/(appareil3)/345|0/(onglet)/0/(brand)/Canon/(brand2)/Canon/(brand3)/Pentax
The Pentax K-x performs better than any camera in its price range and as well or better than some higher priced cameras. Go to this link and enter any camera models you like where it says “Compare Cameras” for comparison
http://www.dxomark.com/
The K-x has Image Stabilization and Auto Focus in the body. These are in the lenses with Nikon. AF is in lenses with Canon. Why pay for IS and AF over and over with each lens you buy? Having IS and AF in the body will save money on lenses for as long as you have the camera. The K-x also has HD video for the price of cameras with no video at all.
Here are price comparisons in your range from B&H Photo except as noted
Pentax K-x w/18-55 $521 HD video
Pentax K-x w/18-55 and 50-200 $625 HD video
Pentax K-x w/18-55mm and 55-300mm $715 HD video
Nikon D3000 w/18-55 $550 No video
Nikon D5000 w/18-55 $700 HD video
Rebel XS (1000D) w/18-55 $530 No video
Rebel XSi (450D) w/18-55 $560 No video
Full specs and features for the K-x here
http://www.pentaximaging.com/slr/K-x_Black/
ImagingResource
“The Pentax Kx has enormous value, thanks to its remarkable image and print quality, fine build, and class-leading burst speed, all combining to make one impressive digital SLR camera. The Pentax Kx is a Dave’s Pick. For sheer image quality at a wide range of ISOs, the Pentax Kx is tough to beat, especially for the price.”
DCResource
“The Pentax K-x is an impressive entry-level digital SLR. It brings very good image quality (especially with a decent lens), snappy performance, tons of features, HD movie recording, and good build quality to the table. If you’re looking for your first digital SLR, then the K-x should be high on your list.”
MacWorld.uk (Editor’s Choice)
“Ultimately, this is a beginner-friendly model featuring most of the latest must-haves”
http://www.digitalcameratracker.com/pentax-k-x-reviews-sample-photos/
Some will argue there are more Nikon and Canon lenses available. Its true. Check the prices. Can you afford all the lenses available? If you can do you plan on buying each and every one? There are more than enough Pentax and third party lenses available for any photographer.