If you are just looking for things to 'sound better' than the radio shack speakers, a set of powered nearfield monitors would help. Rockit, and M-Audio are a couple good ones for reasonable cost.
http://www.samedaymusic.com/prodsearch?form=search/ppc&cat=2864&cat2=3170
http://www.sweetwater.com/store/search.p...CFQsMDQod8XKUZQ

That is for the 'output' improvement. There was a day when Radio Shack had some 'surprisingly' good monitors if you knew what to get, but that was a while ago. They had an underground following for a small set of speakers that were very heavy for their size sold as minimus brand (and also under the RCA brand name for a short period of time). Not powered though, required a separate amp.

For input you can choose from many interfaces, and you already have good suggestions there- apogee, M-audio etc.

Not sure which side of the equation you were looking for. For a 'semi-pro' quick setup I find M-Audio is usually a pretty good start. I personally like their monitors a lot, and use their input devices too. Both input and output can be had for less than the $1000 mark you mentioned. Shop around, they are common products.

I do not work here, but the benefits are still awesome
Make your sound your own!