i7 depends entirely on the market you're in.
Being far overpriced is actually a pretty common myth and generally only applies to budget builds (budget and fastest CPU architecture on the market don't really mesh) or total cost of upgrading from a 775 socket based system.
X58 motherboards are dropping in price, which along with the price of DDR3 RAM (also dropping significantly in price as it's becoming more common) are the real costs of the upgrade beyond the CPU itself, which at $280 for a very OC friendly 2.66ghz stock 920, is on par with what a consumer would pay for a similarly clocked Core 2 Quad.
Also consider longevity. Buying cheaper components invariably means upgrading them sooner or being stuck with outdated specs before you're ready to upgrade (unless you regularly do a cheap build every other year).
A Core i7 build will actually be viable for at least 3+ years.
As for total build cost, an OC 920 build can be done for around $1200 or less (including OEM VistaX64) even without scrimping on VGA cards (GTX260 core 216, HD4870) or resorting to cheap cost cutting moves (generic power supply, inadequate case for OC cooling, etc.).
If I hadn't built a gaming rig within the last year, there's no reason why I wouldn't build an i7 PC.
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