Hi,
If you want to heavily upgrade your A1200, be prepared to shell out some serious cash. Some stuff you can get relatively inexpensively, the case, hard drives, CD etc.
The most expensive component you are going to need is an accelerator card. You'll need one if you want to get the most out of OS3.x, moreover, if you want to run OS4 (and MorphOS), you'll need a BlizzardPPC. These things can be very expensive. If you want to use a PCI graphics card like a voodoo, you'll need a PCI bus board. The Mediator 1200 is your best bet, or, if you get a BlizzardPPC and you can find one, the GRexx (though I don't think this is supported in OS4).
For ethernet, you have several options. You can get a PCI network card for your Mediator/GRexx or if you haven't taken that route (yet), there are many old PCMCIA network cards that can be used.
My main A1200 doesn't have any sort of PCI expansion bus board fitted so I'm using a PCMCIA network card and it is perfectly adequate I find.
If you just want to experience a powerful amiga with networking, graphics card etc, right out of the box, you could just use UAE on your mac. Then you can keep your A1200 as a retrogaming machine, if you prefer.