iMac i7 27inch or Mac Pro Quad Core

I'm converting my edit suite to Macs and I'm stuck...I can't decide between these two options. I need a heavy duty video editing work station that can handle large workloads. I know the Mac Pro is up to the task, but i'd need a monitor taking the total cost to at least $3000. Can the high end iMac handle the needs of professional video production. I know it's a capable machine, I just don't want to buy something I find myself needing to upgrade by next year. Right now I'm leaning toward the Mac Pro, but I really could use the $1000 dollars I would be saving by going with the iMac.

The high end iMac will handle HD video tasks fine. I can say this as I am editing HD - both compressed and uncompressed on a 2.8GHz core 2 duo Macbook Pro with Adobe Premiere. You still want multiple scratch disks and as much RAM as you can afford. Note you can install your own RAM for a lot cheaper than Apple charges.
Memory up to 16GB for Apple iMac 2010 Models - 21.5" and 27" 2.8HGz to 3.3GHz DDR3 True PC3-10600 at OtherWorldComputing.com
iMac (Late 2009) and iMac (Mid 2010): Installing or replacing memory

Also I would get the faster processor as it helps with rendering and re-encoding.

If you need expandability then get the Mac Pro. The other nice thing is you can put multiple disks in the Pro - thus having a much cleaner way to have scratch disks.

The high end 27 imac will easily handle video editing. You can add in as much ram as you need after market from your favourite 3rd party seller. To me the big difference is do you want to pay $3000 for the ability to have a lot of internal scratch disk space. Or are you ok having that scratch disk space external with the imac and saving a whole load of cash.