ok, basic PC for web/office use:
AMD athlon II x2 245: $60
ASRock 760G: $50
4 GB DDR3: $40
Seagate 500 GB HDD: $40
Haans-G 17" monitor: $80 (1440x900 resolution)
DVD Burner: $19
Keyboard/mouse/speaker combo: $30
Rosewill R101 case: $30
Antec EarthWatts 380W PSU: $40
total: $389.
alternately: get this $194 combo (uses DDR2, but still adequate for your parents)
http://www.newegg.com/Product/ComboDealDetails.aspx?ItemList=Combo.610997
add the DVD drive, monitor, and keyboard/mouse/speaker combo, and Windows 7, and its $416
the major differences is the DDR3 vs DDR2 RAM, the case, and power supply.