Refurbished Canon Digital Rebel XT. I got one for $450 with a kit lens, and it's an excellent camera. The kit lens isn't great, but honestly, I'd stick with it for a while before even thinking about other lenses. You will get satisfactory pictures with it, and it's great to learn on. You can get one new for around $550-$600, but honestly, I've no problems with my refurb.
I strongly recommend Adorama.com. They are very reliable, and at least as up to a couple days ago, had a couple refurb canons in stock. They're one of the most respected dealers used by professional photographers. Don't buy from a brick and mortar building, you'll most likely pay considerably more. Investigate whatever retailers you do use online, there are lots of scammers out there on these cameras.
I personally like Canon over Nikon, and I think they're easy to use, but this is something that is very personal to the photographer. People tend to be very brand loyal to one or the other. I would advise against going with any brand other than Canon or Nikon, however. Those two companies have literally owned the market, and when it comes to the future when you'll be buying lenses, accessories, etc. You'll be glad you're with them. Also, there over quality and product development has been going on much longer, and I think they give a better product in general.