I'm in the same boat, looking for a rig for my dad. But I decided to go with a laptop. He just needs it for some Corel work and light Photoshop and mailing stuff. And also, lacking space in his room (need to buy another table for a desktop, too much hassle).
I found this HP Pavilion G6-1318AX Laptop (APU Dual Core A4/ 2GB/ 320GB/ DOS/ 1.5GB Graph): Flipkart.com: Compare, Review HP Notebook is good enough. Will add 2GB RAM to that and that should be fine. Of course, you can do a lot better with a 20K desktop.
EDIT : Well, didn't see the second page. Nice build, congrats.