Don't lowball on the plotter. It's your cash machine, buy a workhorse, not a cheap Chinese hobby machine.
This is so true.
I can relate to this situation, I did almost exactly the same last year. i have a degree in graphic design, and have worked about 5-6 years in signmaking. Got laid off because of "bad economy" in the company I worked in 2010, "strangely" enough just before the boss' son turned 18 and was finished at school, and started in my old position some weeks after..
Anyway, I dediced to start my own business and did so last summer. I have plenty of experience so I know exactly what the local market wants and the spilt of cut vinyl vs prints that are being ordered on a monthly basis. And what size plotter that are needed for the regular jobs.
So I went for a Roland GX-24, not at all a high end plotter, but from personal experience Roland plotters are sturdy workhorses, my first plotter was a PNC-1800 that I bought used, probably 15-20 years old then, I cut at least 1000 yards of vinyl with it before selling it on, it worked for years after that also until a stepper motor gave up.
The GX-24 costs about $3000 over here, but from june 2011 to now it has brought in about $30,000 in profit. $2000 just this past week for a substantial order of cut web url stickers.
Buying a old plotter for 75% less than it cost new and hope it will work for a year of two (could be a month, or a week or two) is a risky business plan if you ask me. You need to be totaly confident in your equipment, not just hoping it will hold together for that big order with a tight deadline that you just received.
Take your $5000, buy a great and reliable plotter in the size you need (Roland GX-24/CX-300, Summa D60 etc) for about half your budget, stock up on a selection on vinyl, and sub out your print jobs until you have made enough money with your plotter to buy a new printer. This way you have time to see how the work load divides between cut vinyl and print jobs as well. Maybe it is 50/50, or 90% cut vinyl and 10% print in your market?
Old, cheap second/third hand printers I would avoid at all costs, there are SO many more things to go wrong and to maintain than with a plotter. At my last job I got stuck with keeping an old Mutoh Rockhopper alive (without having seen one before I started there), spent many evenings and weekends changing heads, pumps, endless manual cleaning, and it only got decent prints half the time. Old solvent printers are the worst.