system upgrade/ build advice

I'm looking to upgrade my system on a budget. I have a 4 year old computer that was built by a friend, general specs are:
AMD athlon XP 2500+
ASUS A7N8X-E deluxe
Radeon 9800 Pro 128MB
1GB DDR400 ram
Barracuda 7200.9 300 GB SATA hard drive
IDE DVD burner
IDE DVD-ROM/CD burner
Antec case with 350W PSU (not sure of the model)

I plan on keeping the case, PSU, HDD and optical drives, so I just need a new cpu, mobo, ram and video card. This system was originally built for gaming, but now all we use it for is internet and some light photo/video editing, dvd burning (using picasa, windows movie maker, sonic my dvd) and maybe office apps. The current computer works fine for all of this, just slower than we would like. My thoughts on an upgrade are:
AMD Athlon 64 X2 5000+
http://www.newegg.com/Product/Prod [...] 6819103211
GIGABYTE GA-MA78G-DS3H
http://www.newegg.com/Product/Prod [...] 6813128335
A-DATA 4GB (2 x 2GB) 240-Pin DDR2 SDRAM DDR2 800
http://www.newegg.com/Product/Prod [...] 6820211188

From what I've read, the onboard video in this mobo would be good enough for what I want it to do, but if I decide it's not, I can throw in a video card later. My thinking is that this setup is pretty cheap and upgradable, just throw in the right video card and I can game. I am also debating on whether to go with 2GB or 4GB of ram. I'm running XP and don't plan on upgrading to Vista anytime soon, so 4GB might be overkill. For only an extra $30 or $40 dollars though, it might make sense just to get the 4GB now.