This is the setup I would go with if I had around $1000:
CPU: Intel i5 2500k $230
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
Graphics: EVGA GTX 570 $330
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
MoBo: ASRock Extreme 3 $122
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
PSU: Antec High Current Gamer Series HCG-750 750W $100
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
Case: CM HAF 912 $60
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
HDD: Seagate Barracuda 500GB 7200RPM HDD $85
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
SSD: OCZ Solid 3 60GB $100
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
RAM: Team Elite 8GB (2 x 4GB) $37
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
Heatsink+Fan: CM Hyper 212+ $30
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
DVD-ROM: Sony Optiarc 24X DVD Burner $19
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
OS: Win 7 HP 64bit $100
http://www.newegg.com/Product/Product.aspx?Item=N82E168...
Total: $1203
Explanation:
CPU: The intel i5 2500k is an outstanding CPU in performance. It is only rivaled by a few other CPUs that are far more expensive than the i5 2500k. The closest rival is the i7 2600k, which is basically the i5 2500k with hyper threading and 100Mhz higher stock clock.
Graphics: The gtx 370 is an amazing card that is unbelievable at gaming.
MoBo: The ASRock Extreme 3 Z68 is an amazing motherboard with lots of features, the most notable is the 2 PCIe 3.0 slots, which allows you to CF and SLI in the future.
PSU: 750W PSU that is 80+ bronze certified. It will allow you to SLI AND overclock your CPU without any problems or worries of running out of juice.
Case: The CM HAF series are gaming cases designed for high air flow and since they have great air flow, the case will keep your components cool.
HDD: 500GB of storage space should be more than sufficient for your needs. I would not go higher since the HDD prices are sky high
RAM: 8GB of RAM is more than enough for gaming and everyday applications. You can even suffice on 4GB of RAM but since 8GB is so cheap, might as well pick it up now.
Heatsink+Fan: The CM Hyper 212+ will keep your CPU cool and allow you to OC it without any worries of overheating.
DVD-ROM: 24x DVD reader to watch DVDs and also to install Win 7
OS: Is this really necessary to explain?