$1300-1500 AUD (about $1000 USD) Gaming/Movie PC

Well you could squeeze in an i7 build into that 1500 AUD but you might have to skimp on few parts...
But you can go with a Phenom build and get a powerful card in the setup...
So which one would you like...
My suggestion would be the Phenom build because the i7 would not offer significant performance gains in games compared to the Phenoms...So better off buying a powerful Graphics card over a powerful CPU if the PC will mainly be used for gaming...

Here is a rough setup...
For an i7 build -
i7 920
ASUS P6T (or) G-B EX58 UD3R - You can make this an SLI mobo by updating the BIOS...And it supports crossfire by default...
6G Kit (3x2G) DDR3 G.Skill-NQ
Preferably WD Black HDDs...
CASE - Antec 300
PSU -
http://www.scorptec.com.au/computer/20287-cmpsu-620hx
or search for the Corsair 750TX
DVD - You can choose one...
Graphics card - GTX 260 Core 216(Preferabley known brands like XFX, EVGA, ASUS,...)

i would go phenom fore a better overall build
everything is in us dollars from newegg.com

cpu
amd p II x4 955BE $245
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
or
amd pII x4 945 $225
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
or fore some real savings
amd pII x3 720BE $140
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

moutherbord
any good 790gx or 790x with the am3 socket
i just ordered this one
ASUS M4A78T-E AM3 DDR3 AMD 790GX ATX AMD Motherboard $140
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

ram
2X2gb of ddr3 with good timings
again what i just ordered
CORSAIR XMS3 DHX 4GB $97
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
there was a good combo deal with these so you can probably find something in the $60 or so range

psu
fore no cf and no overclocking you need some ware in the 500w range
this one got the anandtech gold award and is a good deal
BFG Tech GS-550 550W $55
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

hdd
you want a recently released one but how much you need depends on your uses
if you really have now idea this one has had good reviews (some one that is more up on this can find something better)
Western Digital Caviar SE16 WD6400AAKS 640GB 7200 RPM $70
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

optical drive
they usually run in the $25 or so range just get sata
hears one i got but any is good
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

case
really depends on what you want just good a good quality one with good cooling
this one has gotten continually good reviews
Antec Three Hundred $60
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

graphics
here you got a lot of good options start with this guide (this was before the release of the 7890 and 275)
http://www.tomshardware.com/reviews/geforce-gtx-radeon,...
you got anything from 4870 1gb $189 or so to the gtx 285 fore $350 or so
i would go with the 4890 or gtx 275 in the $250 range
EVGA 896-P3-1170-AR GeForce GTX 275 896MB $249
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
or
XFX HD-489A-ZDFC Radeon HD 4890 1GB $249
http://www.newegg.com/Product/Product.aspx?Item=N82E168...

total runs from $1042-$739

That is well put ke7diz...
layzie you can have a reference for the Phenom build from the above options...and for i7, you can check mine...

CPU: AMD PII X3 710 or 720 with good aftermarket cooler OC to 3.4GHz...
MB: BioStar AM3 790GX (TA790GX)
RAM: OCZ Platinum 4GB DDR3 1600 (7-7-7-24)
HDD: WD 500GB
PSU: PC Power & Cooling 610w
GPU: Sapphire 4850X2 2GB
Case: Antec 300

with any cheap dvd-rw.

Its about $850 USD before tax.

a after market cooler is not necessary if you do not plan on overclocking

but they are nice fore better overall cooling

Thanks guys, appreciate it. Now some of the parts/brands listed I can't seem to find on any of the major Australian distributors sites, so I'm assuming they just haven't/don't come out in Australia. They might come out by the time i buy my computer though.

In the mean time, i did manage to find these:

CPU: AMD PII x3 720 $233

MOBO: ASUS M4A78T-E AM3 DDR3 AMD 790GX ATX AMD Motherboard $225

RAM: CORSAIR XMS3 DHX 4GB $188

HDD: WD 1TB $144

Case Antec 300 $115

PSU: Corsair TX-650 650W ATX $181 I'm not 100% sure about this, but i couldn't find any other recommended PSUs and someone recommended the 750tx so i thought the 650tx would suffice.

GPU: Haven't decided yet.
I read somewhere that the GTX 275 and 4890 aren't that much greater than the 4870. Here the 275 and 4890 go for about $400 each while the 4870 is at about $320. Do the 275 and 4890 offer an $80 boost over the 4870 and if yes, which of the two is better?

Optic Drive: $30-40

So all up that's about $1400-1500. Are there any problems with this setup?

looks good

don't know anything about the psu but should be good

the 4870-275 vs 4870 -260 is up to you the lower would do fine but the upper is better
i personally would go 4870-260 by bang fore buck ratio

4870 vs 260 trade blows in games so unless their is a specific game you like it comes down to witch will get you a better game with it or combo deal

Well yes the build looks good...
But why are you getting such a costly RAM...
Get this it is also a High quality RAMs
4G Kit(2x2G) DDR3 1333 G.Skill NQ AUD 99 or
4G Kit(2x2G) DDR3 1333 G.Skill PI BLack AUD 119
from MSY...

And as for the PSU, as you prefer a single card setup, the 650TX is a very good option and it is a high quality PSU...
As for the graphics card, the 4870 and the GTX 260 are good...but they wont be able to handle very high settings at the 1920X1200 resolutions in some of the games...So I would suggest you get the GTX 275 and also you would save cash by going with the GSKillz RAM...