OP here - I think I forgot to mention I'm a gamer, although that probably would have been obvious. Mostly FPS at the moment but normally pretty diverse.

BEFORE the 4850 you should get a quality 450w+ PSU.
With a new PSU and the 4850 added, it looks fine for mid-high end gaming.

Yes, your desired use of the system is the most important question. Many today find that mid to low end componets are adequate for their computing needs. That said I see three things to improve your system. First the PSU, more wattage from a top tier vendor. How much depends on what the future system requirements will be. At least in the 6-700 watt range maybe better if you have some serious plans, insure that the PSU has the necessary connections for any GPUs you might get. The CPU, think about a q6600 or better or ever a e8400. The Vid card, depending on your useage and budget an ATI hd 4870 or 4850 or an Nvidia 9800 or 260 would fit the bill. I read an artical that found the the 9800 gtx+ was a much better choice over the 9800gtx. Those upgrades will set you back about 500+ or so bills. If you are just web surfing and using office apps then the system is probably fine as is.

first I would like to say that your system is pretty decent already. I have basically the same motherboard and cpu you do (except it's an e6400 instead of teh e6300) and they are pretty solid components. The only weak point I can see is your generic psu. Do yourself a favor now and get a decent psu right away.

The second I would like to address is to auscanzukus' comment about the p965 having crossfire. It only has one pci express x16 lane. Crossfire is not gonna happen on this mobo.

I think you can get a gpu upgrade. I have a 9600gt and it is an awesome card. However, with the prices where they are right now, you're better off going with a higher performing ati card or even the 9800gtx.

If you do not exactly like your case, you can get a new case for it too! Just make sure that you invest in a can of compressed air to clean off your dusty components before putting them in the new case. I have a cheap aspire x-plorer case that I do like. It was under $60 usd plus shipping. If you've got the money for all these things, go for it!

I don't think that a cpu upgrade would be beneficial right now (depending on the games that are being played). I think a 3.2ghz e6300 should cut it for at least 6 more months. I use my e6400 at stock with games and it performs just fine. I have overclocked my cpu too but i get popping sounds out of my soundcard whenever I Oc I've been able to hit 3ghz so far and I'm sure i can go higher with aircooling. those are still decent chips.

OP - Hey guys/girls, thanks for all your help, I really never even considered getting a new PSU, thanks to auscanzukus, outlw6669 and others for pointing this out. Is it important to get it before my new graphics card or should I just make it the first purchase after? I've never had any trouble with anything that could be attributed to it - cutting out, BSOD etc

Rabidbunny my motherboard can crossfire but like auscanzukus said the second card drops to 4x PCIe as the chipset doesn't support 32 channels of PCIe, only 20.

For the use of my computer I do the usual uni work, email, internet but also gaming, at the moment mostly TF2, but left 4 dead and Starcraft 2 are on the horizon, it would also be nice to play Crysis through again with better graphics though.

It sucks that I live in New Zealand, all my prices are almost double what you guys pay, but then again, my economy didn't just assplode, haha.

Geofelt, I've often thought about getting a second monitor, but if I got two I would want three so that I could have a middle one for gaming, which gets pretty expensive. I've got a 19" LG widescreen at the moment, which was fine until my parents bought a 22" Grrr (Then tried to run it on a 800Mhz P3 with 256Mb of RAM - Not a pretty sight, the icons were the size of my fist)

Thanks again guys/girls (Are there any girls?)

Castilo

3 21" CRT's! I would have hated to see your power bills, yea, a 24" is on the list but quite a way down, I'll kick my 19" off to my gf when I get it.
Its so weird, I got my 19 about 2 years ago, when I got it it was the first dedicated widescreen monitor I'd ever seen in New Zealand, it seemed so huge, almost absurdly big and now every computer has one like it and I want a bigger one!