I want to design a system for my family to be used mostly for writing, web browsing, movies/music and occasional gaming for the kids.
I'm planning on a 512MB 5670 card (Sapphire)
I realize that an I3 (550 or 2100) is more powerful than a dual-core e5700/e5800/e6600, but will I notice the difference (aside from gaming)?
I do like to keep computers a while - I'm finally retiring a 1.5GHz P4 after 9.5 years.
I own a non-OEM version of XP. Are there any advantages to W7, or is XP adequate for my needs (I guess I can always wait for W8 )?
Processor: If budget and longevity are your main concerns, I'd probably recommend going with a quad-core AMD based system rather than an Intel CoreI3 based system.
OS: XP would probably be adequate for now, but who can say two or three years from now. In my opinion, aside from the interface, there really isn't much difference between the XP and 7. For gamers, with Windows 7, you get DirectX 10/11. With XP, you're limited to DirectX 9.0c.
Motherboard: Probably won't notice much difference as long as you're going with a discrete graphics card.
Power Supply: Given the HD 5670 graphics card, the 450 watt power supply should be enough, but remember, the power supply is probably the most crucial component within your system. More important that wattage is the manufacturer. Go with power supplies from Antec, Seasonic, Corsair, or PC Power and Cooling. Other responders may offer some additional advice.