Deozaan, that barebones system looks quite promising. Other than RAM and the OS, what else would I need to complete it?
Maybe this is an oversight but it looks like the only thing you would need is a keyboard, mouse, speakers and OS if you got the barebones and the monitor. If you have your OS installation disc from your old computer, I think it is legal to install it on the new one, especially if your old PC isn't in use anymore. But I might be wrong on that. You'd have to read the EULA.
Of course, to play games you'd want a better video card than the integrated one, and as people have mentioned here, PCI-Express is the future of that, but this system only has AGP. Which isn't bad, necessarily, but might make it harder to upgrade later. As for video cards, I swear I saw this on this site somewhere else before but I can't find it, so I'll link directly to Tom's Hardware - The Best Gaming Video Cards for the Money
. Tom's Hardware compared the cards in price ranges and offers the best ones available for the budget.
here's another peice of advice:
if it were me, id rather have a lower power cpu and a bigger lcd monitor.
i don't notice cpu power much but the screen is something you look at constantly.
That's why I suggested a 19" LCD. For game playing and watching videos, you'll want to get a monitor with very low response time. The first LCD I got was about 15ms, and I could still notice ghosting, especially with dark/red colors. My current one is 2ms and I don't notice any ghosting that's not visible on any CRT. The average right now (I'm guessing) is about 8-12ms. It just depends on how sensitive your eyes are.
I don't know about you, mouser, but I use my PC for all kinds of different things that push its CPU/RAM/Video limits. So a big monitor is very important, but I also need good processing power. Of course any of these things can be updated at a later time (especially a monitor), unless your motherboard prevents you from your CPU/RAM/Video card.
It's also important to note that while many computers have the physical space to put up to 4GB of RAM, Windows SP2 (32-bit) does not recognize more than 3GB. But that's probably not affordable in a $500 budget.
Sometimes what I do is buy a decent computer and not worry about a couple things when I know I can upgrade later when I have more money. For instance, I first bought a computer with 512MB RAM, then my brother bought a new computer and I split the cost of a 1GB with him and gave him my 512MB and I used the 1GB for my own computer (saved him, and myself some money!).