I just used www.pricespy.co.nz and had a wee look around at 17" prices. Pricespy is normally pretty accurate. Sure you must already have a monitor anyway? Anyway, buying one second-hand is usually fine, just look out for dead pixels and bright spots in the backlight (the bright spots don't normally mean anything is wrong, it's just slightly distracting). Dead pixels shit me like nothing else, and often mean there's more on the way. You could get a 15" as well, if you could pick up one cheap on Trademe (although I'd be wary), but I can't see somebody wanting to stick with a 15" for very long in a desktop.
There's nothing wrong with CRTs -- gamers swear by them because of the response time and low lag, and they're far better for watching video on than LCDs. The only issue with them is the space, and of course if you get some ancient piece of crap then flicker might be hard on your eyes, but >= 75Hz is OK.
$400 is doable, especially so if you already have an old monitor, keyboard, mouse etc lying around. Then you can upgrade those components as you go. It's much more of a pain in the arse (and a waste of money) to buy a cheap CPU to save money and put in a faster one later. Peripherals are easy.
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