So my friend is looking into buying a beginner drum set so we can jam a bit for fun. I play Guitar/Bass. Neither of us know jack about which drums are worthwhile or utter crap.

The budget is 700 total. New or use doesnt matter. We will play mostly Foo Fighters, Smashing Pumpkins, Soundgarden and such.

I appreciate any tips concerning brands/accessories etc.
I play a Tama Rockstar kit that i have had since '03, and am quite satisfied with it (the kit i started on was...... questionable). I would highly recommend them. You may be able to find a four or five piece kit (which will work for the type of music you're talking about) on eBay or something quite cheap. I'll warn you right now, what will kill your budget is cymbals, they can be quite pricey (i just bought a new ride cymbal recently and it set me back 300 dollars).
Ive noticed that cymbal prices, its a bit crazy but as with everything in music. You normally get what you pay for.