Specs sheet for that system state: "Dual-core Intel® Core™2 Extreme with 1066MHz FSB, 4MB L2 cache, XD, VT, EIST"
Source PDF
The Intel Core 2 Extreme Processor you're looking at has the same FSB, but twice the L2 Cache (8MB vs 4MD). Not sure what "XD" means, but this processor does support VT and EIST.
Unfortunately, what I'm reading online shows that Dell has used two or three different motherboards for that model workstation. Some support the QX6700 and some do not. Without knowing which one you have, we really cannot tell.
I'd suggest installing and running CPUID to find out the motherboard model number and then look to see if the QX6700 is listed as a supported processor.
-Wolf sends