Defintitely get upgrade to Windows XP and def get more RAM. If you have the pennies I'd get more than 0.5 GB RAM. My system often goes over 0.5 GB used when editing video.

More hard disk space would not go amiss either. Remember, 1GB of disk will hold about 5 minutes of raw video capture. You'll need work space for editing too. I'll let you do the sums

A firewire card is a must for the transfer. I'm not sure if you need more than the 'cheap' card you were thinking about. I bought a combo card from dabs.com for my transfers. It has two firewire ports and three USB2 ports on the same card for about £18 + delivery. I've now got some USB2 ports in case i ever need them. Works fine so far. Then again, I've never had an expensive firewire card so might not know what I'm missing.

As for a new graphics card. For the odd bit of editing, I'm not coinvinced it's necessary. Let me know if I'm wrong anyone, but unless you want to spend real money on a realtime rendering card you'll not really gain anything.

HTH

Alan