Super budget or off-lease?

My father-in-law is currently running a computer with I believe Windows 98 or 2000, some super old version of Office, and plays Solitare and a Hoyle Euchre game on it. His main use for it is really jumping on Office to keep track of his car repairs... it's located in his garage. Of course, this isn't connected to the internet, although wireless does reach that far. This also means when he has to look up a part that he has to run inside to use their three year old computer that is connected to the internet. I've asked him many times if/when he plans on replacing the computer, but he insists that he doesn't really care to unless the price tag is free. I'm looked a few places at getting him something off-lease for about $100. The only problem is that virtually all of them run Windows XP and come with 512-1 gig of RAM.

I haven't crunched numbers yet, but would it be cheaper to throw together something capable of running Windows 7 or getting an off lease computer and tossing in more RAM? The only video card I currently have access to requires the extra power (6A or 12 A?) which I'm sure won't be supported by the power supply from an off-lease.

I really don't think a 5-6 year old computer's integrated graphics would run the still rather limited things he would likely want to do. I would reckon he would Skype from it (we have old web cams laying around) since we are moving away, probably watch videos he gets sent from friends/family, play his 2010 or so version of Hoyle, check email, facebook, etc.

I guess what it all comes down to is the fact that I could get an off-lease for $100 and then probably spend another $50+ on upgraded parts on a system that already has 5-6 years of use on it (who knows when a PS or something is going to die then) or spend roughly $150 on an AMD A4 barebones w/ 4 gig of RAM (or maybe cost slightly more since I need a new HDD since my old one is IDE) on a completely "new" computer. So the question is what would be better? I checked on pricewatch for a low-cost barebones option. I'm not sure if looking at a different APU would be more cost effective. And I suppose I could buy 2 gigs of RAM from a different vendor instead of 4.