I'm going to be building a small home asterisk system (probably with freepbx) and wanted to go with a reduced form factor machine if possible and keep price at a minimum.

Requirements:
Must be able to have whatever version of linux I want on it.
Must be able to receive updates for both linux and asterisk/freepbx.
Must (have room for a pci or pci-e card)/(include a fxo and fxs port)
Must have at least 1G of ram.
Must have at least a 1Ghz processor.
Must support at least a 20G of storage space.

I've found a few things that fit the bill roughly but most are either too expensive or lacking in horsepower... any suggestions?

I am not sure what Asterisk is but you could always grab one of them Intel atom integrated boards and build you a tiny system. That's what I did for my replacement NAS