My approach to purchasing would be to by a PC magazine and look through the prices and for any indications as towards the companies reputations. In the UK, I doubt that I would end up buying from any of the big boys and would probably end up dealing with one of the smaller companies that are well established and have a good reputation, Dan and Evesham are 2 that come to mind. I would imagine a similar situation exists in the US and you could probably get a better deal by considering other companies.

Of the big boys, Dell and Gateway do have excellent reputations and are worth considering. I don't know what Compaq are like over here now but my brother had some very unhappy dealings with them a few years ago and judging by Joe Offers comments, they are probably best avoided.

I think SeanM made an important point when he said you need to consider your own technical ability when makeing a purchase and I made a reccomendation for my mother that I would not normally have considered - It was a Packard Bell who in fairness to them do seem to have improved somewhat. The reasoning was simple. It was a reasonable deal, my mother is one of those who tends to panic when something goes wrong with computers, the shop is only 15 minutes away from her and the call out service/ support deal made it IMO the best deal in her circumstances.

Personally, I would not go for the extended service /warranty deals. I have a theory that as a general rule, electronic components either fail very early on in their life (say within 12 months - which is normally covered on a standard deal) or give many years good service and I feel that at least UK, the risk of a failure does not warrant the cost. Having said that, there is the peace of mind factor and that may be important to some and in fairness, I am speaking as someone who could build a PC.

Another thing to consider on the warranty deals is how long you are likely to keep the computer and what its value will be in X years time. With the speed that this technology is changing, is it really worth paying for 5 years cover?

Jon