Well if you just want it for office work etc and have no interest in games you can get a very fast PC for much less than that. And with some places you can still get XP.
For example click here dual core processor add a monitor and there you are, choice of Vista or XP and it has 2 gig of RAM which is enough for either operating system and even a decent graphics card, well pretty decent so you could if you wish play games. If you really want quad core processor then click here again add a monitor.
One thing worth mentioning. I saw a post last week about Novatech and someone was not too pleased that they got no windows disk and he had bought Vista. I queried Novatech and they told me that if you buy an XP computer you get the disk as before but if you buy Vista them if you want the disk Microsoft charge them about £29 to supply it. So you can get the disk at time of purchase but it costs extra.
If you bought a Dell then they too don't come with a disk its a common thing you are expected to create your own when you get the PC. Most manufacturers are the same.
Novatech are my favourite company as they have excellent customer service and thats why I used them as example but for that budget theres so much choice I don't know where to start.
Remember to budget for a printer and if you'll be printing a lot a laser is much cheaper to run than an inkjet and a black and white one starts at about £50, or you could even get a colour one.