Starting this off:
note prices without tax and shipping on newegg but will be shooping arround.
CASE Antec Sonata III
Model #: Sonata III $114.95 http://www.newegg.com/product/product.asp?item=N82E1681...
I considered it a good value it comes with a earthwatts 500w psu, a 120mm exaust fan, 120mm intake fan spot (not included) and also loved the front filter it just slides off for easy cleaning.
MOTHERBOARD Abit P35-E
Model #: IP35-E $89.99 http://www.newegg.com/product/product.asp?item=N82E1681...
I like the one PCIe slot, 8GB DDR2 Ram, it supports 4 sata (no raid), single marvel lan it comes with nice heatsinks for the chipsets p35 ichr9. The Only negative for me is this mobo needs a bios flash of the box to fix the double boot, etc. I've never flashed before but will learn. (hehe I hope)
CPU Heatsink\Fan ZALMAN 9700
Model #: CNPS 9700 NT $52.99 http://www.newegg.com/product/product.asp?item=N82E1683...
I don't think I really need this to run the cpu at 3.0 but I see it helping create a better airflow pattern something like this: the front 120mm intake fan pulls air from the front filter threw the HD blowing at the video card, right above the video card the Zalman 9700 will blow the hot air from the cpu heatsink straight at the 120mm exhaust fan, also don't forget the psu 80mm will exhaust as usual.
Thermal Paste Heatsink Artic Silver ceramic coumpound
Model #: CMQ-22G $9.99 http://www.newegg.com/product/product.asp?item=N82E1683...
Getting this mainly because of reviews lot of people happy, didn't want to use permanent adhesive, this is something that should be easy to cleanup for reinstall or upgrade. I noticed that zalman includes a Thermal Grease (ZM-STG1) not sure about it so leaning towards the artic.
MEMORY Coarsair XMS2 2 x 1GB DDR2 800 PC2 6400
Model #: TWIN2X2048-6400C4 $77.00 http://www.newegg.com/product/product.asp?item=N82E1682...
Well it can run 4-4-4-12 at 2.1v also comes with heat spreaders. 2GBs should be good for now maybe down the road when Vista can actually support 4GBs will add the an extra 2GB.
HARD DRIVE Western Digital Caviar SE 160GB 7200 RPM SATA 3.0Gb/s
Model #: WD1600AAJS $49.99 http://www.newegg.com/product/product.asp?item=N82E1682...
Well I'll put it this way, I have a 40GB drive with XP just about 96% full, will have a hard time filling up 160GB. I also made sure it had the sata conection for lower latency.
I'd get a case with 2x 120mm fans built in and no door, which is only in the way when you want to access a DVD/CD.
The Zalman is not PWM, so the mobo can't control the speed and it will run at full blast. If you want something controllable (quieter), get a CPU cooler with a 4-pin connector. Either that or see how you like the OEM fan. I've got an E6750 at 3.2 on the stock fan that maxes out at 46 C. under use. It's noticable but not too loud in a Triton case.
Save $30 with the basic eVGA 8800GT and O/C it yourself with RivaTuner. If you are going to buy a cooler, get one to replace this howler.
XP Pro for performance, Vista is a hog, and there is NOTHING that needs it to run. XP runs great with 4GB.
Otherwise looks sweet.
About getting a card and overlclocking it yourself. Yes you do save some money, but cards that are not overclocked do not usually overclock very high. The cards that are stock overclocked have been picked out of the batch basically, because they overclocked the highest.
^ Generally thats the case, but of course not the rule. But at a $20 difference I would get the factory overclocked card. XFX and BFG tend to overclock their cards the highest. The reviews on newegg suggest that the card you picked is very good at overclocking. You could also just try that.