Not really showing off - kind of asking for advise of which area to off load more cash into this system

Gigabyte (M61SME-S2) - motherboard
NVIDIA GeForce 8600 GT - graphics
Audio - (built in MB)
2047mb ram = 2x 1GB DDR 2pc5300
AMD Athlon(tm) 64 X2 Dual Core Processor 4200+
ISO-450pp - power supply (under review for noise came with case)
149gb (Hitachi HDS721616PLAT80) - hard drive
DVD+/- RW

built myself for home/mild gaming for under £300, runs fine just curious if there could be any improvements

Get a soundcard installed, you can pick up reasonably priced soundcards for under £20.00 at Maplin's in the UK...

Its on board the MB, do seperate cards make that much difference?

Is this a gaming PC? If it is you should consider going Intel, the intel budget CPU's like the E5200 can be easily over clocked and you can get a lot of power out of them. my one PC running a E5200 (standard 2.5GHz) I overclocked on stock cooling to 3.2GHz with no issues and barely any temp rise, with a good cooling unit you can get it up to 4Ghz if you brave, lol

Its not a hardcore game machine, more a family unit, however I do run some games that are graphic dependent and so do the kids - hasnt caused any issues as yet but I have seen smoother systems.

I am looking at Ram Samsung Original 2048MB DDR2 800 PC6400 RAM x2 which I assume will work as the MB says the following

1. 2 DDR2 DIMM memory slots (supports up to 8GB memory)(Note 1)
2. Supports dual channel DDR2 800/667/533/400 DIMMs
3. Supports 1.8V DDR2 DIMMs

New cpu? I did think of intel when I set it up however it was the cost at that time - although might be considered, the current unit runs at 35deg. Overclocking - read that section 4 times think I need to read it 8 more though

Like I said its not a major system for gaming but it may get there as the kids grow

They certainly do, I have always replaced the onboard sound with Creative soundcards on my computers.

It's easier to get the drivers from their website as well, that's if you have lost the driver disk that comes with the card...

1) An Intel CPU won't work with the board you have.

2) Buy a high quality Corsair or OCZ (there are a few other brands) PSU.

3) The 8600 GT GPU will be a serious hindrance to playing more sophisticated games in the future.

4) IMO (and some people disagree with it), upgrading with an add-on soundcard for a newer motherboard that already has onboard HD sound is not money well spent. If sound quality is of prime concern, try DFX 9: FXsound.com - DFX Audio Enhancement Technology - Better Sound, Powerful Experience or SRS Audio Sandbox: http://www.srslabs.com/store/store/comersus_viewItem.asp?idProduct=6

5) Check the QVL approval for any RAM upgrade on the motherboard's webpage. Though these lists are rarely up to date, at least those on the list should work. You can also visit the myriad of RAM vendors and check to see if your motherboard is listed on their site(s) and/or run the memory scanner. Definitely opt for DDR2 800 and 2 x 2GB. If you run a 32-bit O/S it won't recognize the full 4GB, but you'll have it if and when you upgrade to a 64-bit O/S later on.

I'd say update RAM and video card... or SLi your existing card if your motherboard supports it.