Yes the processor could be the bottleneck but when I had a lga775 mainboard I had a q9650 processor with two gtx295 graphic cards and it was bottlenecked!?.
I would spend about 700dollers on a new intel sandy bridge 2600k gigabyte lga1155 mainboard combo or go with the amd phenom 1060T processor and gigabyte am3 type mainboard combo for about 200 less. The 6870 Sappire is not such a graphic powerhouse that you should need anything else then an amd to run the bottle neck out of the brunt of the graphic card power. To answer your question about the windows install. Yes you will need to install a fresh set of windows but you can always access low level information off the old hard drives or back the info up onto jump drives then use the old hard drives in your new system!
to answer your last question: as far as the install of all the computer parts are concerned either use reverse engineering(by looking at how your old system was put together). Or look online for various video tutorials on how to put together a computer processing unit.