When my daughter asked for an American Girl Doll, there was no way we were going to spend $100+ on a doll. Sorry, but no.
We went and bought her a Next Generation doll at Target. She loves it! She's played and played and played with it. Of course, she still occasionally asks for/says she still wants an American Girl Doll, but I think that has more to do with societal and peer pressure (all her friends have an AGD; some friends have more than one!) than an actual wanting of one.
Her cousin also wanted an AGD; her parents went out and bought her a Target Next Generation doll as well. She loves her doll just the same as if it were a AGD.
We just told our daughter we weren't into all that consumerism and buying, buying, buying just to buy. And that we didn't have a money tree in the backyard! ;)
The Next Generation doll would be a good investment. And they have really cute clothes for them.