Any Intel Mac will be fine. The demands of running the development tools and simulator are just not that severe. I have a first-generation MacBook, which was a 1.83GHz Core Duo and 2GB of RAM and that is more than adequate for iPhone development.
A Mini would be fine, and will be the cheapest legit Mac you can buy with refurbs recently going for $419 from the Apple Store. One bit of warning though is that you'll really want to upgrade to at least 2GB of RAM, the Minis all ship with 1GB, and have about the worst RAM upgrade process I've ever seen. You need a putty knife to pry it open. Seriously.
The other alternative would be building your own Mac. I have a Hackintosh I built with an Intel Core 2 Quad Q9300, Gigabyte EP-45-DS3L motherboard, 640GB HD, 4GB RAM and nVidia GeForce 8600 for around $600 after a bunch of rebates. This is far more price/performance than Apple will ever sell you, and also allows you to have hardware combinations that you simply can't get from Apple's limited product line. Using one of the hacked OSX distributions, with a little bit of trouble I was able to get everything working with the exception that it sometimes won't shut down completely and I have to give it a hard power-off (although sleep works, and getting sleep to work is problematic for a lot of Hackintosh hardware combinations).
I still think that if you are planning to release apps commercially it is a good idea to have a real Mac on hand, but if you just want to get started or have a reasonably powerful machine without spending $2500 and still getting a year-old substandard GPU, Hacs are pretty cool. You may even find that your existing Windows PC has generic enough hardware that you can get OSX to run on it. This is the case with a lot of current-generation laptops.