First off, ANY system that uses an Intel CPU is going to cost more than the equivalent AMD system, if cost is an issue. I would also do a cruise around the Motherboard and Chipset forum for people who are having problems with that motherboard. I've seen some pretty unhappy posters on that score. People are having problems getting much in the way of customer service out of ASUS. A good alternative may be GigaByte or AOpen. You can hit company's web sites until you find the motherboard you like best.
I'd want at least 512 megs of memory, but more is better (assuming you want to run Win XP or newer). I see your two 256 meg sticks, but that takes up two RAM slots, too. I'd go for a single 512 meg unit.
Now, from the video card choice, I'd say you're looking to get a system capable of playing today's games. What you DON'T have is a hard drive that will last long, in terms of space. I know of a number of games that will eat over 2 gigs of space EACH. Then you figure in 1.5 gigs+ for Windows, and a bunch of other stuff and your 80 gigs disappears in a hurry. Spend the extra $40 or $50 and get yourself a 160 gig or bigger drive.
And, if you can't get those kind of good prices from a major supplier, then build it yourself. It's not too hard if you follow directions you can get online and you take some basic precautions (anti-static wrist strap, etc.).
One last note is the monitor. I don't see that you listed one, so I'll assume that you're going to use the one on your current system. I don't know how old it is, but if you want a good CRT monitor, this is certainly the time to upgrade to at least a 19". LCD's are fine for most things, but it takes a top unit (in performance AND price) to play current games. It would be a little pricey and the money would be better spent on something like a faster CPU or more RAM.
You're welcome, as well. I don't mind someone asking for help. What jerks my chain are the people who could very well just fire up Google and trace the answer themselves, but they want you to hand it to them on a silver platter.