If you don't need gaming then you could go for a HD5570 or 5550 and it'll do fine. Other than that it looks good. Just hope your old RAM didn't die. What about power supply? I'd suggest at least something from the Rosewill Green Series. Almost certainly your old one of these is dead.
he wrote "I should see some improvement in app speed and I can throw it all together for less than $500"
so i thought he will not be gaming so the x6 is a better choice.
am2+?? he didn't even mention it??
He said he wanted to use his old DDR2 RAM. Therefore only AM2+ and RAM isn't needed.
When people give you a number for price, that's never an absolute. It's what they expect to have to pay to get something decent working. When you can show them something that will do what they want/need now for half or less than that, they're always happy. Almost always they're coming from an ancient single core that hasn't been touched in years. So an athlon II x3 is almost always what's needed. That isn't the case here since he's replacing a quad, but there could be a x4 or phenom x4 that would do it.