Yep... photo printing at home is expensive. These things are like razors... sold cheap so you'll have to buy the overpriced ink.
That being said, we've been very happy with our Epson CX5200. It's a multifunction that we got for under $100 after rebate. I never knew how much we needed a copier until we got this the Epson. It's big and makes a horrendous noise when loading paper, but we love it.
http://reviews-zdnet.com.com/Epson_Stylus_CX5200/4852-3181_16-20584412.html