I recently bought a 2003 Savage here in NC, and that price (depending on the condition of the bike of course) is pretty good. If the bike hasnt been dropped, the chrome and trim are in really good shape from being stored indoors, and she is turn-key ride-able, you'd be hard pressed to find one too much cheaper.
Sounds like you'd be happier with a bike with a great engine but everything else is crappy

, but even "parts bikes' can go for $900-1000 around here.
I suppose you would need to look at what all you wanted to do before you purchase the bike. That year has short risers and buckhorn pull-back handlebars (I hated them), so you will need a set of bars and either store-bought or DIY risers. Good news is, you wont have to replace the clutch or brake cables.
Changing the seat can get expensive..and has it's frustrations. Our Savage has a "frame dip" where the seat is, and getting a flatter seat on there will leave a big air gap. If you are handy and can work with sheet metal, covers can be fabricated to cover that gap.
Changing the position of the controls even more so than the seats...is a lot of work.
Changing a Savage into a bobber is not that hard from what I have seen here. Changing her into a cafe-style racer is a bit more money and work. Changing her into a STANDARD bike (like a Bonny or the old Kawasaki 550's) seems like it would be harder than both of the above. Again, it all depends on how much labor you can do yourself, and how many parts you can scavenge off of eBay.
Good news is, the Savage has one of the best singles out there. Your powerplant wont be an issue.
Have you done a Google picture search for "modified Suzuki Savage"? Plenty of ideas out there (though a lot of those pics will bring you back here). Just a heads up, when using the search function here...the default search time frame is just 2 weeks. Make sure you change that to at least 1 year if you really want to see what's here.