The beauty of the nice store bought costume that you buy for $20 or $30 is that when your kids are done with it, you can donate it to Goodwill or Salvation Army, so next year a family who can't afford $20+ for a costume can pay just a few dollars. Last year we bought the cutest Uniqua costume (from the Backyardigans) for our daughter. She loved it and she looked adorable. When she was done, we donated it, and I hope some other less fortunate little girl gets just as much enjoyment out of it this year.
Also, going a little off subject, what do you do about a mother-in-law who is constantly shopping at the Salvation Army for clothes/costumes for your kids that they don't need? She and we can afford not to shop at Salvation Army, so why should she go and buy up all the good stuff instead of leaving it for the people who really can't afford to shop elsewhere. We end up just re-donating everything back, so I guess it works out well for the Salvation Army. They get my mother-in-law's money, plus they get the clothes back to sell to someone else. Win-win!