Dear Lissa, oh no!!! I think a lot of us women fall pray to beautiful, shiny, gorgeous gowns, so you're not the only one! I too did the same thing. I had travelled to NYC for my appointment at Kleinfeld's (showroom of TLC's Say Yes To The Dress) and even though my budget was wayyyy lower than the vast majority of their dresses (budget = $1K = no chance) I tried on quite a few dresses that were up to $3K and they were beaaaaaaaautifullllllllllllllllll. There was one I fell in love with that cost $2,500 but my fiancee was the voice of reason and said I would look beautiful in anything and that I would surely find another dress that I would love at our budget.
At the same time, I have a girlfriend who selected a cheaper gown than the one she truly loved and she regrets it to this day. I say, you only get married once (at least, you're supposed to), and you want to feel like the most beautiful woman in the world, so I say if you can stretch the budget a bit, take away a little from here, a little from there, go for it!
Good luck in your decision!