Can I use a 21" iMac as an external monitor?

I'm considering getting an iMac or Mac Mini so I can run Xcode.
My budget is low, so I'm considering just getting a Mini and using it with an old VGA/DVI monitor.
However, as the iMac includes a monitor, mouse, and keyboard, it's actually the same price as a Mini with a mouse, keyboard, and monitor.
Plus, the iMacs are more powerful.
I don't intend to do much on it, just Xcode and maybe some gaming. Gaming is not the deciding factor here.
I've been searching for an answer for hours, and all I found were outdated threads.
My question is:
Are 8GB of RAM really necessary for Xcode, and is the quad-core CPU of the iMac needed?
I also read that an iMac can be used as an external display, but only the 27" models.
I am looking at a 21" 2013 model.
I currently use a Windows gaming desktop, and have lots of extra monitors lying around.
Multi-display support is a must for me, and the iMac screen is way better than anything else I have.
Is it possible to use a 21" iMac as an external display for a Windows machine using a DVI/DisplayPort adapter?
I've read in different forums that "it has to be Thunderbolt". "It has to be a 27" not a 21". "It has to be 2010 or older".
Basically:
Can I use an iMac as an external display for my Windows desktop, and can it be the 21" model?
I'm not getting a Mac very soon, so please take your time.
-Thanks a lot,
Nick
BTW: This is my first post, so it's probably horrible.

Hello Nick, A a warm welcome.. great 1st post too!
I'm afraid using the iMac for a PC Monitor is out, unless it might be a newer PC that has a thunderbolt prt & can output Video through TB port. 2009/2010 iMacs can use MDP. But 21.5" iMacs work as well as the 27" ones for either method.
Not sure DVI or even DisplayPort converters work though.
Here's how it's supposed to work...
http://support.apple.com/kb/HT3924
Mid 2011s & up need Thunderbolt!
http://support.apple.com/kb/TS3775
Are 8GB of RAM really necessary for Xcode, and is the quad-core CPU of the iMac needed?
Well, problem is twofold, 4 GB is barely enough for the OS & one App, & you can't really upgrade the RAM yourself later.
I'd go for the Quad core, computers always get slower over time!
Might be some 209/2010 options here...
http://www.powermax.com/parts/code/PM_CU_IM_I1
http://www.powermax.com/parts/code/PM_CU_IM_I8

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