VGG, I have a Canon ZR40 and it takes fine pictures. I was only $900 after tax, so it is a bit less than what you are willing to spend. Don't get drawn in by the digital photo hype (the ZR40 has no digital photo capabilities, since I already have a fine digital camera) since these digital photographs are as good as the bottom of the line digital cameras today. A dv camera is for digital video, not photographs. As well, look for optical NOT digital zoom. The ZR 40 has an 18x optical zoom, which is quite good. Digital zoom is an advertising ploy, since it is like watching a TV from 2cm away.
I would agree that still photo features are nearly useless in a DV camera for Mac users.
DV still mode typically produces a low-res (640x480) interlaced still; a $50 JamCam does better. Mac users can just grab a still shot at full, non-interlaced resolution via iMovie.
Althought this "feature" is becomming pretty common, you probably are better off buying a camera where they spent that money elsewhere.
Important features that you may find missing on a lot of models include:
Mic inputs, so you can avoid the cheezy microphone built into most models; the built in mic is only useful for unprepared, outdoor shooting and casual indoor videography. Some models actually have the microphone on top, pointing at the sky (a bad idea). Built-in microphones often pick up noise from the mechanism itself, which you will notice in quieter scenes.
Analog A/V inputs, so you can digitize movies made on older camcorders, VCRs, etc. Most require you to transfer to the camcorder's DV tape before you can load the footage into your Mac, but Sony has at least one model that digitizes on the fly; it saves time.
Analog A/V outputs, so you can transfer finished product to a VCR for distribution to this practically universal medium; it's helpful if you want to send a movie to relatives, etc who may not be techno-savvy, or to create a presentation for business or work related purposes.
Watch out for inexpensive DV camcorders with low resolution CCDs (680K is the standard, but some inexpensive units do less than that). Higher resolution ("megapixel") CCDs are now available.
Digital Zoom & in-camera effects are useless, don't pay extra for them. You should shoot only with optical zoom and effects-free. Taking advantage of these "features" should be avoided at all costs; shoot straight footage and save the effects for later, where iMovie (or any other program) can render much higher quality effects.
Most in-store ads feature much about these useless features and very little about what counts, so be prepared to do some homework and ask questions.
Be sure the camera fits comfortably in your hand and that all controls are easy to reach (and hard to accidently activate). Although small size is popular as a selling feature, most serious videographers prefer something with some size and heft to keep camera shake to a minimum.
Vorvis brings up a good point, and one I would like to elaborate on.
Buying at the big-box superstores is very tempting, especially if you have a budget. I'm going to suggest you don't do that.
Find a good camera store that sells video stuff and have the sales staff work you through the models features, controls, etc. Explain to them that you have a Mac for Digital Video and want quality results. You may pay a little more (or you may not, these days prices are competitive everywhere) but the support you get will definitely save you some money and grief (when comparing prices, I add $100/hour to a product's price for grief, cuz I hate that job).
A lot of people will select models at a store like that and then run out and buy the cheapest model elsewhere. If you are absolutely broke you can too, but these places know this happens; purchase and cultivate a good relationship (buy tape, etc) with them and the deals will follow. You get the best of both worlds.
I shop at a camera store where they actually lend me the stuff to go out on the street to play with for a half hour or so. In the case of film cameras, they give me the thing and I shoot a roll of film for a half-day or so. If they don't know you, you could offer to give a card imprint while you go off on your test. Try that at Future Shop, and you'll find it's a great way to have the usually attentive salesman act like you just dissapeared.
These days, it's pretty much Canon and Sony for the good stuff, but just because it's got the right brand don't assume it's a camera meant for serious work; these guys have to make models to attract boneheads too.
If you are looking for a Sony, try price checking and check for how current the model is at a factory Sony Store. Don't expect good service, it's not much better than Big Box, but because Sony doesn't want to antagonize it's retail chain, you will find the highest prices there, which can help you assess value to find your bargains.
Once you have a good idea of what you need and don't need and are ready to buy, don't be afraid to ask for a competitive deal with a good, helpful store that offers a different (but high quality) brand. Here's where your painful shopping at Big Box Ltd comes in handy. "I was just at ... and saw I can get a Blowfish 2000 for $999 with this stuff. I know your Pufferfish 2100 has these other fancy gee-gaws, but I don't want those features. Can you match the price?" Do this with cash (or whatever) on your person and tell them your buying TODAY. Feel free to ask the salesman for a card while mentioning that your cousin Ralph wants one too. Good luck.