I'm a canon guy.
Won't get into Canon vs. Nikon (as that discussion can end nowhere good lol)
BUT, you can get a 40D for relatively cheap right now (and it is has a better sensor than the newer 50D
)
Or, the new rebels that Canon has come out with are really not bad, then you can save $$ on the body and focus on the lens.
I am assuming the Nikon you looked at comes with a kit lens. It is my opinion that kit lenses are FAR less superior than spending some money on a better lens. The body is not what is important for quality pictures (having the most MPs, etc doesn't matter) Sacrifice a little bit on the body if you are on budget and put it into a better lens. A faster, sharper lens will help out way more than an extra MP or two for the body.