Printer: right now Epson has some specials. Go to http://www.epsonstore.com They had a photo printer for $75 yesterday and also sell the 13x19" printers too.
I would argue against getting a 13"x19" printer unless you're prepared to make a substantial investment in inks and paper and routinely need to print larger than 8.5" wide. Most people never go larger than 8 x 10 or notebook paper 8.5" x 11".
A 13" x 19" printer will also be pretty large and take up a lot of space. So, carefully evaluate your needs before getting it.
For printers, stick with Epson or Canon photo printers; they are the best.
As for the camera...that will depend on your needs. I would suggest a Nikon D40 or Canon EOS Digital Rebel XT to start, because those cameras are available new. Just get the standard 18-55mm kit lens to start. For lights...either 1) get the manufacturer flash to start or 2) use a tripod and get some inexpensive photofloods (and then custom white balance).
Now, because I'm more of a risk taker I would get a different setup for myself, and I'll share that with you in case you want to take that chance too.
1) I'd get the $75 Epson Photo printer, the R380:
http://www.epson.com/cgi-bin/Store/consumer/consDetail.jsp?BV_UseBVCookie=yes&oid=63059189
2) I'd get a used Fujifilm S2 Pro, about $350 used. Yeah, it's older and used, but will blow even modern cameras out of the water for color.
3) I'd get the SB-800 flash, about $320.
4) I'd get an alien bee with an umbrella and stand (extra):
http://www.alienbees.com/b400.html
You can skip the SB-800 if you plan on staying in-studio.
Edit: forgot to add the lens! I suggest in my scenario above the 50mm f/1.8 lens. $125 new. And the alien bee light is about $250 with stand/umbrella. So to keep it around $1000 you'd have to forego the SB-800. So: 350+75+125+250 = $800