is there anything wrong? +cpu upgrade

Before I ask any questions, this is my rig

Core 2 Duo E6400
Ati HD 4850
2 GB RAM DDR2 (Transcend 1066 Mhz - I think)
Asus P5B mobo
Win XP Home
PSU 400W (unknown brand)
250 GB HDD (Western Digital, no idea what model)

I am thinking of getting a new processor, because I think my old one is bottlenecking the system. I am getting 17-35 fps in Crysis on all High (NOT very high => I have XP) and 1440x900 (no AA). Should I be getting more with this system? Is there anything wrong with it? Can it be the PSU, if anything?

I am between the Core 2 Duo 8600 and the Core 2 Quad 9550 which are about the same price in my country (Greece). I haven't flashed my BIOS since I bought it and to be honest, I am afraid to do it, since I know nothing of these things. Do I need to change anything in my system for it to accept one of these CPUs? Which one should I choose, if I am more interested in games? Also, do I have to upgrade the PSU as well? And if yes, to how many Watts? 500? 600?

Any help would be really appreciated. Thank you.

Somehow, when I go to the BIOS, I can't change the FSB value from 266...it's not greyed out (as with all unavailable properties), but when I press enter, nothing happens...still though, I know nothing about overclocking and the guide I read here is pretty confusing for a newbie like my...plus I only have stock cooling.

Thanks for the suggestion though.

Small correction (which can turn out to be quite big)...My RAM is PC2-5300 @ 667 MHz. Can this be the bottleneck? What do I do to OC that?

Overclock your CPU first to see if it's really the bottleneck. Download the asus update manager off the asus website, it will flash your bios for you.