That's not a bad price if it comes with all the accessories, harness and PCM. If it's just a block, pass. The 6.0L will give you a little more bottom end if you're leaving the engine completely stock.*who can do that?*

A set of pistons and rings is going to cost you about $550 if you go new. Sometimes you'll find a great deal on rod/piston assemblies on Ebay. The gaskets to rebuild the LS1 will cost you about $100 for the head set and then you'll need individual gaskets to complete it, about $250 total on gaskets.

I'd say get a complete running engine and pass on a project engine, too much of a PITA to gather parts to complete the assembly.