Not Paid for Services Performed

A neighbor of mine has an embroidery business that they ran out of their house. We had talked off an on about the possibility of me working for them as a sales rep. I elected not to do that, however offered to build a website for them (www.rainbowedi.com). They insisted that they pay me. After completing the site, we discussed and agreed on an amount: $2000. The problem is that none of this is in writing. Because they were "friends" and insisted on paying me, I didn't think to write up an agreement.

They kept putting me off. Eventually they moved, and claimed that they couldn't afford to pay me because they had to pay for repairs to the house they moved to. I sent a letter requesting payment and threatening legal action. I received a letter back, stating that they never agreed to pay me any money, but would let me work for them as payment.

If you look at the site, you might surmise that I put a considerable amount of time into the development of the site. I registered their domain name and set up the hosting service for them. I scanned many of the images, and was able to copy (legally) others from their suppliers website.

I would like to know if I have a case worth presenting and what percentage chance I would have in winning.

Thank you,
kjes68 in Portland, Oregon