I don't know why he needs $1000 either. I bought a cheap older unlocked WP7 device for under $250 just by keeping an eye out for bargains.<p>Contact your local MS rep. I nearly every market, the MS evangelism people have devices for people to test on.
What exactly do you intend to create? How is it going to earn you an income? And most importantly, how do you intend to "pay it forward"! Even a donation is an investment!