Everything's fine I guess, but why have one CD, one CDRW and one DVD? Get a DVD-RW instead and nothing more. This will both be a cheaper and better solution if I were to have my say...quality DVD burners can be had for less than $99 nowadays...
To your questions...
1) For me, Win XP is the best OS that MS has ever done, so I'd recommend that you upgrade while you're at it.
2) Hard to say. I used to have two 36 gb Raptors, but I got some problems with setting up a working array the second time so I got a 120 Gb drive instead. But since RAID is faster than non-RAID I suppose two 36 gb drives is the better solution, provided you can escape the possible problems.
If you're looking for somewhere to skimp, take the P4 3.0GHZ instead of the 3.2, never take the best CPU if the only difference from the one-step-older version is clockspeed, it simply doesn't make sense.
I know what everyone's been wondering - 2^33634943-1 IS NOT PRIME. Now, wasn't that worth running <A HREF="http://www.mersenne.com" target="_new">Prime95</A> for a month to know?
All great;but raptors run hot and if not well cooled start to whine.I agree with you're having more than one optical drive;but for gaming you just need one cd which reads at 52 and one dvd which reads at 16 with one of them a rw for backup.