Honestly, he's stitched you up. You can buy a similar base unit for about half that price on ebay (like this one: http://cgi.ebay.co.uk/ws/eBayISAPI.d...m=160307163057 - but this is infact better!)

He's right about saying you can't upgrade the Dell.

It wouldn't make a great gaming machine. The video card is fairly low power by current standards and the machine needs a lot more RAM (although this is cheap).