The Canon 40D was followed up by the 50D, and now the current 60D. The 60D is a bit different though; it has a polycarbonate body (the 40D's body is magnesium), an articulated LCD, and offers video, which the 40D did not have. However, with the standard 18-135mm kit lens, it is more than your budget.

Currently there is a special on the Canon T3i which may be of interest to you:

Here is a review of the T3i: