SCSI refers to the older parallel SCSI interface, which uses a ribbon cable internally.
SAS refers to the newer SCSI drives, it stands for Serial Attached SCSI. The cables used here are similar to SATA cables, but the controller is different.
Most newer SCSI drives are of the SAS variety. Newer drives that the manufacturers come out with are likely to make a shift to SAS-only, similar to the way that consumer hard drives have made a transition from IDE to SATA.
Still, a $1000 premium just for moving from SCSI to SAS seems high. I would investigate why the price difference is so much and see if another server vendor would give you a better price.