I've been running exclusively on dells for years now, both desktops and servers. Nothing wrong with a Dell 1600sc. Some thoughts:
purchasing (I'm assuming US):
- the outlet, dell main site, and ebay are all relatively indistinguishable in terms of quality. And all three have all sorts of different prices depending on what the weather is like. Check all three. Do not assume that the outlet is cheaper or better. YOu can score unbelievable deals from either the main site or the outlet if you watch. I've got bunches of 600SC's for $249 last year (the 1600sc's baby brother). And I just bought a low end 750 and a loaded 1750, but paid top dollar because I wanted them fast.
- You should consider if you need redundant power and redundant (raid 1) hard drives. and whether you need windows OS - linux is free and runs fine if you can admin it.
If you don't feel the need for redundant anything, the 400sc or 700sc will probably do you - I don't see data transfer as a big thing. Otherwise you'll need the 1600sc or better. That is a tower server, not a rackmount by the way. Be aware that the power supplies on these dell servers tend to be just a bit different than stock off the shelf so if it does go, you're waiting for a shipment from Texas.
So if cost is primary, 400sc might actually do you. Smart money though is as above. Get a redundant power supply and a raid 1 system with scsi hard drives (not sata which are not as reliable). Or better yet, put together a proposal with the costs for a 400sc vs a 1600sc and let the brass decide if they want the redundancy.