ASUS A8N SLI upgrade questions

I'm looking to upgrade my system, and am not sure about which components to get. I'm not too good with this stuff, but if I can get some help with component advice, some people at work can help me put it together.

I have:
ASUS A8N SLI motherboard
AMD 3500+ (2.21 GHz)
1G DDR 400 RAM

I will be wanting more RAM, but how much can I cram in here? should it also be DDR 400?

Should I overclock my CPU? How do you do that? If I don't know how, does that mean that I should not even try?

What kind of a video card should I get? I'd like to plug this computer into my new 40 inch LCD HD TV (am I dreaming that this computer could be hooked up to the TV and accomplish anything?). I'm not much of a gamer, but I'd like to future proof this thing as much as possible. Currently I have an ATI RADEON X800. I think they no longer make drivers for my videocard. So, I'd like one that will still have drivers available in a few years.

Is this enough info?

Thanks for any help you can lend.

with $200 you could just get a new CPU, Mobo, Ram set and use the IGP

CPU: Athlin II X2 240
Mobo: ASRock M3A785GMH/128M AM3 AMD 785G
Ram: OCZ Gold 4GB (2 x 2GB) 240-Pin DDR3 SDRAM DDR3 1066

its about $215 and would give you room to upgrade if you want/need to