I also agree that unless you're a gamer, the least expensive computer would be more than enough for most applications.
I strongly suggest you stay with XP if at all possible. I say this with a years experience on a system with Vista. Of all Microsoft's operating systems I've used, 3.1, 95, 98, 2000, and the latest, Vista. I would say Vista is the most frustrating system to date.
I've had Vista die or lockup more times than all the other operating systems put together.
It doesn't like Firefox, and occasionally locks up when using Internet Explorer. When programs lock up, there are times that I can't even get them terminated with task manager.
I end up rebooting at least twice a day. I've recently acquired a copy of XP pro, and will soon wipe Vista and go back to rock steady XP.
Sorry for the rant
OH, and Merry Christmas everyone