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Any suggestions on my first homebuilt gaming rig? ($800~)

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I'm a big PC gamer, but I've been doing my gaming on a horrible system for the past several years (it can handle HL2 and WoW, but that's the limit). So, it's time for a new system, and I want to build it myself.

Right now I'm just looking for advice on the parts. I'll probably be coming back for advice on setting it up as well, after going through a ton of guides and stickies on the subject. :D 

My goals for this rig:
Lowish budget, preferably around $700 before OS (I still need to buy XP, which brings it near $800)

Easy for a first-timer to get working, nothing too complicated like overclocking

Upgradability! I don't want to skimp on the PSU/Mobo/Case/etc. If I want to upgrade the CPU/RAM/GPU in the future, I want to be able to just buy it and stick it in and be done.
Here's what I'm thinking so far (open to suggestions on everything). All prices/descriptions from Newegg:

Mobo:
ASUS M2N4-SLI Socket AM2 NVIDIA nForce4 SLI ATX AMD Motherboard - Retail
$86.99

Looking for lots of suggestions on this, I don't know much about mobos. :) 

CPU:
AMD Athlon 64 X2 3800+(65W) Windsor 2.0GHz Socket AM2 Processor Model ADO3800CUBOX - Retail
$76.00

I'm thinking this is all I need, but I'd be willing to go a bit overbudget for a better CPU if a 3800+ is going to be a bottleneck in games with my GPU.

GPU:
SAPPHIRE 100186L Radeon X1950XT 256MB GDDR3 PCI Express x16 VIVO HDCP Video Card - Retail
$189.99 (before a $20 mail-in rebate)

This is about the performance level I'm looking for. Should I maybe splurge for a 8800GTS? Are there any video cards on the horizon in the 180-280 price range I should wait for? Anything around the price of the X1950 XT that beats it in performance? This is the most important part of my rig so I want to get it right.

RAM:
G.SKILL 2GB (2 x 1GB) 240-Pin DDR2 SDRAM DDR2 800 (PC2 6400) Dual Channel Kit Desktop Memory Model F2-6400CL5D-2GBNQ - Retail
$88.99

Looked like a good deal. I'm also fairly open to just buying 1GB now and leaving the option to go 2GB later, so there's room here to save cash for some other component instead.

HDD:
Western Digital Caviar SE16 WD2500KS 250GB 7200 RPM SATA 3.0Gb/s Hard Drive - OEM
$69.99

250GB is probably more than I need...if there's a much cheaper, good quality HDD in the ~150GB range, I'd love to know.

DVD:
Sony NEC Optiarc 18X DVD±R DVD Burner With 12X DVD-RAM Write Black E-IDE / ATAPI Model 7170A-0B - OEM
$30.99

THG used this in all three iterations of the computers in that recent building marathon thingy, so I figure it's good quality.

Case:
Completely undecided. Looks are important, but so is ease of installation, noise level, etc. I've been looking at a Cooler Master Centurian 5 and a few others. In the end it'll come down to mainly looks, but for the love of god, if it has a bunch of LEDs, it better have a switch to turn them off when I want to sleep. Looking to spend 50-80 bucks here.

PSU:
This is where I need some major help. I want something that can handle at least one moderate CPU upgrade and one decent graphics upgrade down the road, and is reliable enough to last a few years. Looking to spent 50-80 bucks here as well.

Total of above:
$643-703 depending on Case/PSU. An identical setup on Cyberpowerpc.com would be at least $950. :D 

Like I said, I'm mainly looking for suggestions at this point; nothing is set in stone. Thanks in advance for any advice! Love the forums (I've lurked here forever), so I know I'll get some quality help here.

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The build looks great, you've obviously done a ton of research.

The Lian-Li PC-7B is an awesome case, great quality, easy to work with, and it fits your budget.

Your PSU budget is pretty tight. $80 is really the threashold for good quality power supplies that have enough power for a build such as this. This is about the best you can do for $80. Don't get me wrong, it's a great quality unit with plenty of power, it's just one of the only options.

good system, let's tweak to save a little without losing performance.
I like the Biostar 550 MB/3600+ combo. If I remember right it has a 800 mhz memory speed, others don't hit it right on 800.
The e1950XT is a sweet spot right now, and good GPU for the price range.
Ram Is a great deal and one thing you should keep for better all around usage.
Nothing wrong with HDD or DVD
Case choice is fine, I always ask if you can buy local to save the $16 shipping.
PSU is tough. but your plan is solid. For this system the FSP 430W is good, but going to a 8800 or more CPU would be taxing, might be better to get a good 500-600W to start. Good ones are the Corsair 520/620 units.
Hope that gives some ideas, and be sure and ask if you need more info.
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Here's my suggestion:

Case/PSU: Antect Sonata III with 500W Earthwatts PSU. Here. ~ $130 after shipping. The PSU alone is 95 bucks at Newegg.

CPU: Intel C2D E4400 - $139

NOTE: All you have to do is go into the BIOS and change the FSB from 200 to 266 and now you have an E6700 with 2MB of cache instead of 4. Heck, you could go to 300 without any problem and it would be faster than the X6800. The E4400 has the same CPU multiplier as the E6700 which makes it an overclockers dream for the price.

Mobo: Gigabyte GA-965P-DS3 V1.3 - $100

Memory: Crucial Ballistix 2x1GB DDR2 1066 - $125 after MIR.

HDD: Seagate Barracuda 7200.10 Perpendicular Drive 320GB - $80

Video Card: Sapphire X1950XT - $170 after MIR.

Total: $750

It's 50 bucks over your budget. Now, initially, you don't have to overclock. Just know that this would be one hell of an overclockers dream for you to dabble with in the future. To meet your $700 goal, you can just get the cheaper memory.

Wow. Thanks for all the great replies guys. :D 

As for the PSU, I'll up the budget to $100 or so and get something nice. Still unsure on which yet, but I haven't done my homework on amps and rails and voltage or anything yet; once I read up on that I should know what I need.

For the three case suggestions, the Lian-Li PC-7B and Antec Sonata III and P180b, those are all exactly why I'm unsure on cases. :o  None of them are too fancy, but the P180 especially looks really well-done, and both brands have ridiculous reputations for quality...but then again something like a NZXT Apollo or APEVIA X-DISCOVERY look awesome (unsure if I want LEDs at all though). Also thanks for the suggestion to look local, I hadn't thought of that. Any reccomended stores? Fry's or something?

CPU/Mobo:

I'd already been considering switching the system to C2D for a while, and I think Purdueguy has convinced me to do it. Sounds like I'm getting a ton of extra performance after overclocking a little for the fifty bucks or so it costs me. I still need to read up on overclocking and cooling etc before I decide for sure though. The e4400 and GA-965P-DS3 look like good choices.

Also, how does future CPU upgradeability compare between AM2 and LGA775 boards? Both about the same, or is Intel a little better?

HDD:

I have a noobish question here. Currently I have a 80G drive that has a good installation of XP on it, but I don't have the disc or product key that came with Windows. If I were to simply use this old drive as the OS/storage hard drive in my new computer (along with a new HDD for gaming/mass storage etc), could I avoid spending money on buying XP again? Or would it cause problems with booting up and stuff?

If the above works, then I'd go for Mjam's suggestion, since 160+80 is plenty of space. Otherwise, probably Purdueguy's 320G HDD (only ten bucks more than the 250G I had picked out).

My RAM/DVD/GPU choices seem solid. I'll have to look more into RAM and overclocking and stuff though to decide if I need Crucial RAM over what I had picked.

So with the above changes, if I end up with a ~$100 PSU and ~$75 case, I'm up to:

$780 before OS if my HDD idea won't work for whatever reason
$750 total (won't need to buy OS) if I can use my old HDD with XP already installed

If I can avoid spending the $90 on Windows, I could easily get a nicer case/RAM/etc, which would be nice. Or just save some money. So if anyone could be so kind as to point out any problems I might have using an old HDD to get the system running rather than a Windows DVD, I'd be grateful.

Thanks again for the advice.
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