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You're fine with the warrenty
Im torn myself, usually after a year you would notice any problems, so you may not have any, but if kill your keyboard or mouse, you my get them replaced free if you can explain that it was somehow manufaturing defects.
I dont have an answer, for you, Applecare doesnt totally cover you for theft, or any fire , flood or any damage you cause , so, only you can answer the question. $400 is a load of cash true. Ask Macdoc, he would know how many defective MDD Powermacs come back.
I have a mac bought in March of this year, so I will face the same dilemma next year.
 
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