Well your AMD 64 X2 4200 would cost you $174 at newegg.
The cheapest Core 2 Duo, E6300, would cost you $181. So you can hardly say that the AMD processor is beneficial in price.
sums up pretty much how powerful this processor is. A very striking and all-saying line can be found on the sixth page of that article; "Conroe only won 35 out of the 37 tests! I am sticking with AMD."
On top of that, it's been said that the E6300 overclocks very
far, up to a whopping 200% of its clock speed (with an aftermarket cooler).
The most commonly used 775 motherboards on this forum are Gigabyte DS3 ($135), Asus P5B-E ($151) and P5B Deluxe ($183) and the nForce 680i SLi ($250). All fitting within your budget, and overclockable to ****.