Upgrading the old machine

I have an old Sony P4 2.8 with 512 RAM and an FX5200 AGP graphics card. I have been attempting to watch 720p videos and HD online content. It's clear that this machine isn't particularly up to the task. I am planning on putting 2GB of ram in it, but should I also upgrade the graphics card? My budget is $200 and I am able to run Windows XP or 7 (32bit).
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More about upgrading machine
  1. Forgot to mention that my machine has a 250 watt power supply which seems to be custom, so I can't easily replace it.
  2. Go for a decent 400w unit ($40-75 on ebay can get you a nice unit) and see if you are able to land a 3850 agp for about $75 used (ati 512mb auction).
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