There are loads of considerations when buying a defender and I will breifly go through a few:
90 or 110?
Clearly the 110 is much bigger and so would be better for family and also is the favoured car for expedtions due to the increased size. 90's on the other hand are better off road ( there's not a massive differnce though) but more importantly you can fit them in garages and car park spaces etc where a 110 may not fit.
Engine
At your price range and if you aren't going to do serious off-roading then the TD5 will probably be the one. For your budget you should be able to pick up a very nice example, especially with prices reducing due to the credit crunch and also more are on the market. There is also the 300tdi which is the earlier engine and is not as refined as the TD5 but does lack some of the electronic control which the TD5 has, arguably making it a better serious off-roading engine (but who can beat a 200tdi ).
Style
From the sound of your original post you will be after a station wagon-the ones with rear windows and seats, and it would be easier just to buy one in this style as opposed to getting it converted.
Off-road toys
Don't be too attracted by lots of off-raoding goodies and these don't add much to the value of the car and signify that it has probably been off-road, so may be worse for wear underneath etc. Instead buy a standard road defender and then if you feel the need add your own selection of goodies and melt your credit card!
When looking at your perspective car make sure to have a good look around the chassis for any patches of rust. The engine should start up with minimal smoke and pull away smoothly. check that it's been serviced regularly as well.
I'm sure you'll get lots more replies and I hope this helps
Pete