Budget Upgrade to handle AVCHD editing

I currently have a P5B deluxe with a Core 2 Duo (6600) and an ATI 1950PRO graphics card. The system was put together a little over 2 years ago and is suitable for almost all my applications with one exception....it chokes on AVCHD video.
I would love to upgrade to an i7, but that means spending more money than I want (in addition to the CPU, I would need new RAM & a new Motherboard). My goals on the upgrade are to spend as little as possible, while getting enough extra horsepower to handle AVCHD rendering/conversion/editing.

Here is what I am currently thinking

- Upgrade the CPU to a quad core 9550…I should be able to over clock this to some degree (I know a more recent motherboard would allow more overclock and better options, but I am trying to keep costs minimal)

- Graphics card…I have no idea on this, but I am pretty certain I will need to upgrade in order to get smooth playback. The PB5 deluxe has PCI-E v1. I believe that the PCI V2 cards are backwards compatible. What budget card would be recommended….I am preferential to ATI, but could do an nvidia card. Was looking at perhaps: MSI R4670-2D512/D3 Radeon HD 4670 512MB 128-bit for about $50 after rebate.

- Memory – I currently have 2GB of DDR2 6400 Corsair XMS (1GB sticks). It doesn’t overclock all that well…at 2.15 volts, I get 833 stable. A couple of questions 1) How much of a performance hit will I take by having the CPU and FSB at different speeds? 2) Does adding more memory even make sense while running 32bit Windows XP? I have heard many people say that adding more than 2GBs in an XP environment is pointless.

Thanks in advance for any input.
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More about budget upgrade handle avchd editing
  1. You should upgrade to 4 GB of memory. 32-bit XP will see only 3.2~3.5 GB though.

    PCI-Express version 2.0 increases speeds to 32x which is well beyond what most computers can actually use. An important thing to note is that most video cards that are designed for 2.0 will NOT work in 1.0 slots. They will, however, work in 1.1 slots.
    PCI-express 1.1 was introduced in 2005.

    What is your power supply?
    Does it support the 4670?

    Is your e6600 overclocked? If so and you are still having problems, a quad core could be beneficial.

    If your memory speed is equal or higher than your CPU speed, no problem.
    If your memory speed is lower than your CPU speed, you will take a hit.
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