Ok I have been pondering this upgrade for a few months now and was wondering am I going to notice a huge difference in speed,performance and visuals with an upgrade? I strictly do gaming and not much of anything else. I am not really into overclocking and just want something fast and stable.

This is my current sysytem.

Intel Pentium D 935 Pressler 3.2ghz
Msi p965 Neo F
Wintec Ampo 4gb ddr2 800
Antec Earthwatts 500w
Visiontek HD3850 256mb
22" Westinghouse running @ 1650x1050

Now all I was thinking about upgrading for now was my case,motherboard and cpu. I can use my ram,video card and PSU for now and upgrade the rest to this:

Antec 900
GIGABYTE GA-P35-DS3L
Intel Core 2 Duo E8400 Wolfdale 3.0GHz
In the future [maybe alot sooner] a HD3870 or HD3870X2

So will I notice a huge difference with this upgrade or just a little or no noticeable difference? My budget is $500 for Case/Motherboard/CPU....the video card upgrade will come later.

For many things, yes you will see a big difference. My wife has a similar CPU and I'm going to give her my e6750 when I get a quad. According to the CPU charts, she'll see quite a jump. You'll see an even bigger one for CPU-bound programs. Don't expect a big FPS jump in games; the HD3850 begins to be taxed at 1680x1050 (mine certainly is).

So would i be better off just upgrading my video card to a 3870,8800gt or 3870X2 instead of motherboard/cpu upgrade? What I am actually looking for is more fluid and better graphics for games like COD4 and WIC when running at 1680x1050 with everything maxed out.

A video card with more RAM would definitely do well for you.

So i ask again, if i am purely looking to upgrade my gaming performance only I am better off just upgrading my video card then i am upgrading my cpu/motherboard?

Yes. Something like an 8800GT with 512MB of RAM would be a notable step up. I'm in a similar situation and may do the same. I've got a 3870 sitting on a shelf, but I'm not happy about the HD38xx drivers, particular relating to fan / cooling issues. It looks like I will be going back to nVidia, possibly the Asus model with a radial fan on it.

Why not just d/l rivatuner and manually up your gpu fan speeds? I have read that this takes care of any cooling issues. The HD 3870 by Visiontek has been on my list for quite some time now and for $50 cheaper then any 8800gt 512md card you can't go wrong. Now the HD3870X2 is out I am really confused

I tried that. The results are not consistent. Typically only one or two of the threshholds I set actually change the fan speed. If it's the 40% and 80% ones (completely ignoring the one for 60%), the fan audibly revs up and down while I'm playing. I'm thinking of redoing it at a fixed 60% and see how that goes, but still the card and/or its drivers are buggy to behave this way. I found an article at guru3d about BIOS issues on that card, so...

UPS will be dropping off my new $285 USD 8800GTS-512 (G92) withen the hour. Like haveing a 8800GTX but uses alot less power.

EDIT: UPS truck is here now!!

There is nothing wrong with the P965 Chipset so you should just get a Core 2 Duo E4600 , E6420, E6600, etc. whichever fits you budget and upgrade the video 8800 GT 512 or 8800 GTS 512 (Not the 640 or 320) or ATI 3870. Your ram etc. is good enough, I am running a 8800 GTS on 500 watts without problems. Your mobo limits you to 1066 FSB unless you can manually set it to 1333 which many but not all P965 Mobos allow this. If yours does then an E6750, E6850 will be a good upgrade. Any one of those Core 2 duos should be faster than anthing based on the P4, Mhz doesn't mean as much as it used to a 2.4 E4600 C2D or higher will out perform a P4 based processor of a higher clock easily in most cases.