The 40d body is more robust than the 400d (we have 400/50/20/10d bodies in our household). The 400d is a quite a lot smaller and dare I say less 'serious' as far as build quality is concerned, they are fine but I dont think it (400) will last as long as the others, could be wrong. The men in our house dont like the 400 as its too small, my wife prefers it, which is why we bought it, plus its light weight. I doubt there is any real difference in image quality between either the 400 or the 40, so I'd try both and see which you prefer.
Your budget will need to be stretched if you want 'good' portrait and macro lenses. My 100 2.8 macro was approx £400 on its own.
Matt
, it absolutly smashes the socks off the 400d by a million miles in my opinion, better build, ergonomics,better fps,metering, af, its just amazing, i now wonder why i didnt do it sooner, oh yeah i forgot (Funds) :bonk:, ive actually got it sitting next to me as im typing this and carnt stop looking at it 
, I managed to get a good deal, i got a mint 40d body with 2100 clicks and an mint 17-85mm IS usm all boxed as new for £550 
, you can pick up a good 40d body for around £400 now. Have a look on here ( www.eos-magazine.com ) there's a few availible, i was going to buy one from here but found one 4 miles down the road....... good luck 
