John, go to "post your best bird shots" thread, looking for Joel Eade's pictures. he used to use 40D+300mm 2.8 and sometimes with 1.4XTC to shoot smaller birds in his back yard, and recently upgraded to a 1D III(refurbished for $2400). here are some links for his pictures in this thread taken both with 40D and 1D III:


http://community.the-digital-picture.com/forums/t/2706.aspx?PageIndex=40


http://community.the-digital-picture.com/forums/t/2706.aspx?PageIndex=41


taking a look at his pictures may help you decide which way will you go.


I use 7D and 300mm2.8 with both TCs and 400mm5.6, most pictures I'v taken are bigger birds(e.g. GBH and egret) in flight or action, and I'm not very happy with the 7D, my biggest concern is sharpness, my keep rates are lower because lots of pictures were not very sharp even when the shutter speeds were 1/3200 or faster, though I'm not sure if it's because of the 7D or my not very steady hands, I was wondering if using 1D body will make big difference. but when it's sharp, 7D can produce very good bird pictures.


getting a better lens seems always a better choice, I probable will get the 500mm 4.0 first if I were you, I'll also consider getting a 1D III . used gears are ok to me if budget is limited. 2X TC seems a waste IMO.


good luck!