I am attempting to simulate an MPLS WAN environment consisting of 4 sites. Each site will have one LAN router and two CE routers connecting to two different PE routers, for a total of 20 IOS devices. The router models aren't necessarily important, just the IOS features. The LAN routers will run OSPF, CEs will run OSPF and BGP, and the PEs will run MPLS/BGP.

I was told a 4 or 6 Core Intel Processor with 16G RAM running on a Linux OS would be best for this type of simulation. Does this sound about right ? My management team is balking at the 4k price tag on an HP Z800, so I'm trying to see if there is a cheaper alternative.

You can divide this workload across several medium-performance hosts, instead of buying one super-powerful machine.

GNS3 allows to run in this configuration using "external hypervisors".

Using quad-core is fine... something like Core i7-2600K CPU + 16 GB of RAM will solve your problem.