First of all, check the nut at the top of the strut, I lucked out and the knocking noise was only that for me. Also check the "bilstein knock" thread for other ideas.
If it is definitely the internals, you can get them rebuilt by Bilstein. I can't see where you are located, but if in Sydney, check this thread by Jack_Keaka for Bilstein rebuilding:
http://forum.liberty.asn.au/viewtopic.php?f=25&t=34495Front struts are $437 per pair and rears at $345 pair.
(FYI, I haven't done either (rebuild or go coilovers) so can't help with any personal experience. You haven't mentioned what prices you have been getting, but I imagine the entry-level coilovers are going to give a fairly firm ride. Shockworks coilovers get a lot of positive comments, but that's because you get what you pay for: +$2k.)