I know most of you would go for a more expenisive aproach but what would be your choice for a gun and scope for under $1200 to shoot out to 500 yards and possible out to 1000 yards
It all depends on what you intend to be shooting as far as game/targets or a combination of both along with realistic max ranges for each.
The .308win will definitely get you to 600 with deer, and if you can place the shot properly at least 500 for larger game, but that's about your limit.
The .300wm will do all of that and be fully capable of Elk out to 800yds and deer at 1,000yds.
As for your price range if you really want to start with something capable of sub MOA accuracy you are going to have to spend a little more money. Something like the Remington Sendero is a great platform for med-long range and most of them will shoot MOA or better right out of the box and better than that after just some basic accurizing.
When it comes to glass my advice is always the same, "Buy the best you can afford".
I would always encourage people to be a little patient and save for an extra month or two if you have to in order to get quality glass.
Magnification wise if 1,000yds shooting really is in your plans you probably need to start with at least 14x. You can get by with 10x if it's really good glass but it's hard to pick up much real detail at that range with 10x for most people.
If the above rifle is out of your price range you might check the classifieds and try to find just a good, used CDL Remington or Mod 70 (not a featherweight) and of course as someone else suggested the CZ's. I've shot a lot of CZ's and every one of them were sub MOA right out of the box.
So there you have it, depending on what you're shooting and realistic range limits either the .308 Win, or .300win would be my first two choices with the good ole 30-06 thrown in as the middle ground between them. The other calibers I'd throw into the mix are the .300wsm and 7 Rem Mag.