wow isnt very intensive. you should be able to get something decent for 1K. however, doing 40 man raids on a laptop doesn't work unless you get a VERY nice one. it should work fine for just everyday wandering around and stuff. anyway, you will want at least 1 gb of ram. a mobile processor would be nice. Maybe an AMD Turion X2 would work out well. AT LEAST 128 mb of video memory, but it needs to be at least equivalent to a x800 type speed.
From there you can customize any specs you want, also making them fit for the amount of money you're going to spend.
I would go for an Intel CPU, now the Intel Core 2 Duo and probbably for an Nvidia Graphics Card, also it'll be good if you have around 1GB in ram as it is important. Regarding the hard disk space it depends what you're going to do with it.
yea... you dont need a grand to play wow.. i was on one of the top three guilds in gorefiend... (just meaning that we were an intensive raiding guild)... and i raided two times a day depending on who was on... and my laptop held up great... no lag unless due to server (ironforge/ogrimmar) <-- (if u havent played these are main strongholds that most players are... therefore that = server lag....
my specs were pitiful too... here's my 650$ 1.5 year old laptop that ran wow with no problems... (although the graphix werent dazzling...)
Just wait for Dell to release a 30%-40% coupon on there inspiron line.
Google search Dell coupons.
You dont need an xps to game on a laptop.
My Dell 9300 will play every game I own. Just go with the smallest amount of ram (512m) and toss it and put 2gigs in it from the egg. BF2 plays at high setting and looks and plays awesome.
If I were you I'd get a Dell E1505 for your budget. Alienware and Dell's XPS is way out of your price range. http://www.notebookreview.com/
Helpful place to find a good deal on a labtop. I know that they update the Dell coupons every week.