You should be able to get a well specified computer for that amount of money. To give you some idea, a basic computer (Internet ready) should be available for around 500 Euro.
Look for a machine that has a minimum of a 2Gig processor (though it will likely be higher than that), 512MB of memory and at least an 80 Gig hard drive (120 Gig preferable). The graphics card should be separate and have at least 128MB of on board memory. A DVD/CD burner should be part of the specification. The machine should be multi-media and Internet ready for that price and almost certainly include Windows XP Home.
Often, you will find good deals at your local PC store and have the very real option of local backup, should you need it. Something that many major manufacturers are falling short of today.