We cannot give you financial advice on how much leverage is appropriate for you. However, as we mentioned above, trading 1 troy ounce with $1000 in your account is just over 1.3 to 1 leverage. The price of gold would have to drop from $1322.91 down to $322.91 in order for your $1000 account to fall to zero.
The other risk to consider is the risk your broker could be taking on by offering traders 500:1 leverage or 1000:1 leverage. Other clients of such a broker may use leverage more aggressively than you. See this earlier discussion about the risk of account balances going negative. Can I lose more than my deposit?