The eMac is about as close as you are going to get. You get more stuff and more importantly you get a MAC running OS X.
I don't think Apple could squeeze out margins large enough to make building $700 computers worth it, because they don't do anywhere near the volume that Dell does. The only reason the iMac is still around is to keep the education market happy.
$999
700MHz PowerPC G4
128MB SDRAM
40GB Ultra ATA drive
Combo drive
56K internal modem
17" Display/Integrated Video
Speakers
Ethernet
Firewire
$699
1.8 Ghz P4
128 MB RAM
30 GB HD
CD-RW (24X)
CD-ROM
Integrated Intel Graphics
17" Monitor