I am considering opening an online store and would like to do a
competitive analysis to determine product pricing (by SKU) from a
range of existing stores (assume a broad category like home security
systems - cameras, lighting, etc. and 5,000 items).  Initially this
info will be used for financial projections but I would also like to
regularly update
the data to stay competitive and determine how much impact pricing has
in customer aquisition and retention.  

What's the best way to approach this without spending a ton of money (<$500). 
Are there any open source or inexpensive applications / shopping bots
that can screen scrape or analyze data feeds from existing price
comparison sites (Froogle, BizRate) or individual online catlogs
(www.twacomm.com) and auction sales (Ebay) and put it all into a
structured database for analysis?

Does anyone offer this as a service for small business merchants?

my personal experience and opinion would be to avoid ebay at all costs.