Basic e-mail/web surfing computer - $400 budget

Hello-

I am building a basic websurfing/e-mail computer for a friend of mine, and I saw this combo deal advertised on a Newegg:

http://www.newegg.com/Product/ComboDealDetails.aspx?Ite...

Here is what is in the combo:

1. Intel Pentium E5200 Wolfdale 2.5GHz LGA 775 65W Dual-Core Processor Model BX80571E5200

2. ECS G31T-M7 LGA 775 Intel G31 Micro ATX Intel Motherboard

3. Western Digital Caviar Blue WD5000AAJS 500GB 7200 RPM SATA 3.0Gb/s 3.5" Hard Drive - OEM

4. SPARKLE SX94GT512D2L-NM GeForce 9400 GT 512MB 128-bit DDR2 PCI Express 2.0 x16 HDCP Ready Low Profile Video Card -

Price for this is: 189.96 w/ a $15 mail in rebate for $174.96

Here are the questions I have:

1. Is this a good way to go?
2. If so, what case, ram, CD/DVD burner and PSU would work well here?


The computer will be running XP for a few months until Windows 7 is released.
Monitor is 22" resolution: 1680 X 1050
I have mouse, keyboard and basic stereo + subwoofer speakers.

The machine will be used primarily for storing photos, music, web surfing and e-mail.
They may load some basic educational programs for their kids.
I would like to keep the overall budget under $400.

If this is not a good way to approach this, can you recommend a better way?

Thanks in advance for any replies.