Some venders still sell Intel 965 picobtx boards that should fit your case and work with older 1066 core2 duos, such as the e6750 or e4500, which I use. Do a search; one I found was around $65 recently at one of the larger sites; possibly amazon.
No the XPS 400 can only support the Pentium D series and older. I have a XPS 400 and I also looked into installing a C2D in to it.
The Fastest CPU would be The Pentium D Extreme Edition 965, If you can find one and want to pay for that.
IF you can get a XPS 420 motherboard. It will fit in the XPS 400 and support the C2D. The Dell XPS uses a BTX case, a ATX Mobo will not fit.
1HAPLO - is that confirmed that you can use a XPS 420 motherboard in a XPS 400 case? That's be great news for me, but I haven't been able to confirm anywhere else. If that were the case, I could then upgrade the CPU to a C2D instead of being stuck with a Pentium D 965 or something.