What's the deal with over seas Nikons being sold for so cheap in the US?

Okay so there's a Nikon camera I want and it runs about $1200.00 us, IF I want to buy it through Nikon or the local camera store. (an authorized Nikon dealer)

While looking on the net, I found the same camera, for $700.00 with 1 year warranty. I wondered how this can be possible. What I found out was that the $700.00 version is not a "US model" but rather from over seas. Therefore voiding the Nikon US warranty. I was told I'd have to send the camera back over seas if it breaks during the warranty period.

Has anyone bought an over seas camera or other electronics before? Am I crazy to still want to purchase this camera? If it breaks can I just send it back to the country I got it from and have them repair it under the warranty that comes with the camera?

What am I missing here? I want this camera, especially for $700.00 instead of $1200.00 but don't want to get screwed in the process.

The deal is that those grey market cameras have only an International Warranty, so if something happens that requires warranty work, you must ship the camera outside the US for service and that will cost you not only the shipping costs, but any customs fees that may apply.

In addition, NIKON USA will not touch those cameras or lenses even it you wanted to pay to have them repaired.