95% of the cost of a ring is the diamond. And resetting can cost a bit and you're confined to the cut that makes sense with the band. So resetting an existing ring probably won't save you anything unless there's a wholesale gem place near you that sells just diamonds and good prices. You'd probably be a lot better off with just buying a ring. Resetting is great if the band has sentimental value. I wouldn't consider it otherwise.
And, no, I wouldn't do the whole "2 Months Salary" thing. For many of us that's far too much money. About half of that should be more than enough and you can get a very nice ring for $2000 (less if you really wanted), particularly this time of the year. You'd be pressed to find a ring in most mainstream jewelry stores that even cost 2 months of your salary anyhow.
What you can "expect" purely depends on what you want. I wouldn't spend less than about $1750 but if you're next to a Tiffany's or something you could spend 2 months salary pretty easily. Only you know what you can afford, but if I was you, I'd be looking in the $2500-3000 range.
