Your memory
settings may be holding your overclock back.
I bet you are running your memory clock (or whatever ASrock calls it) on AUTO. Change it to MANUAL and select a 2.00 multiplier if you haven't already. FSB increase to 400 MHz gives you 2.8 GHz at DDR2-800 speeds.
You are hamstrung by the relatively low internal multiplier of your CPU (X7).
Next:
All DDR2-1066 memory is is DDR2-800 memory tested to run at the higher speed, generally with looser timings and a higher voltage. Loosen the timings to 6-6-6-18 and increase the RAM voltage by 0.2 volts. Then see what happens.
If I were to do a low budget upgrade on your system, I'd buy a better video card and better memory. Or maybe change the CPU to an E5200.
Yes, that's right. It's a great overclocker. You should be able to get 3.5 - 4.0 GHz out of one. The high internal multiplier (X12.5) is a great advantage. And the base 200 MHz FSB means you could keep your existing RAM. The higher potential core speed will compensate for the smaller cache. And it's less than $70.
I reached 3.78 GHz (stress tested with P95) with mine using my old ACF7P. Search for "E5200 overclock" for examples of what people are doing with them. E5200 seems to be a better overclocker than the slightly more expensive E5300.