First, I agree with jazzfan4 about Doug Burwell. He is THE essential person to know if you are going to collect Schuco Monorails in the US. He knows a lot, is totally honest, and wants to help people get their layout running well. You might get a better price on Ebay, but you will have 100% confidence that what you bought is what you will get at a "fair" price. Go to his site FIRST and figure out what things should cost.
Second, I agree that the Schuco engine you pointed to on Ebay seems to be priced too high. One in much better shape should cost about $250US.
Third, IMO, the Schuco's are in a whole different league than the modern monorails. The Schuco's are vastly more flexible to layout as well as more fun and interesting to run. The Schuco's are not quite perfect "scale models" but they are orders of magnitude better than the modern ones which are more of a "toy." If you want something to run, and not just to look at going around in a simple circle or oval (although there are some unauthorized track that adds some flexibility), the Schuco's are SO much better. You have a wide ranges of speeds, the you can weave them under and over each other, the switches let you route the trains.
I personally like the HO scale better as it lets you put a bigger layout in a given space. The modern toy monorails are closer to "O" / Lionel 3-track scale.
A video I made showing 7 Schuco's running at the same time: http://www.youtube.com/watch?v=p_z3nGMyC-U&feature=channel
Thread with a bunch of discussion on Schuco Monorails: http://www.burnsland.com/disneyrailroads/viewtopic.php?f=8&t=4229&start=0
There are a few downsides to the Schuco's of course. The first is that they are an expensive hobby. You can't just run down the the store for parts and accessories. It can take years of collecting to get a large set (my set was largely formed over about a 5 years period with occasional additions over the next 5 years). And they are finicky to run, but they will run very well ONCE you know how to run them and you know how to clean and care for the track.
One more thing, the Schuco Monorails are INCREDIBLY durable except for the paint (particularly the silver). I have not seen any "Toy" from the 1960's that can take the level of use that these can take. Doug Burwell takes his to shows and runs them for 8 hours or more a day. I have never seen a Schuco engine that I couldn't get working and Doug told me than in all the dozens of engines he a seen, only one he couldn't get running. Most of the Schuco Monorail collectors are very helpful supportive of others getting started.