If you have 500 bucks to spend, you can pretty much get a whole new computer, and a good one at that. What parts do you already have though that you are willing to keep? To be honest, a 7600GT won't really cut it in modern games.
Will it do alright to begin with though? If I use it for a month then it wasn't a waste of money and I won't have to set a memorial service for more wasted money. It's all about peace of mind at this point.
The thing that really ticks me off about this is I went to a company that built me a computer before and that computer is still running. But when this computer started having problems they wouldn't do more besides reformat the HD and send it back to me. Just make sure you don't send anyone to myAOpen.com. Waste of money and I'm kicking myself for not building one myself then.
Oh and is anyone else recommending Vista Home? I've just heard awful things about Vista and I love XP Pro.