I'll go something like the GT instead of the GTX and some more RAM
Don't forget the PSU - you MUST ensure you have the power before adding any more hardware - you would hate to have an overstressed PSU catestrophically fail, and take out your motherboard, and anything connected to it. Better cooling will depend on what you start with, and what video card. Some cards are double-wide and exhaust hot air directly to the outside. This is fine, if you still have enough cool air being drawn in for the rest of the computer. You need good front to back air flow. The better cases support at least two 120mm or bigger fans, preferably one in front drawing cool air in, and one in back, in addition to anything in your new

PSU, exhausting hot air out.
I normally don't try to dissuade anyone from purchasing more RAM because most of the time, that is where you get the most bang for the money - especially for those running with only 512Mb or less. But once again, you already have 2Gb! That is a lot of RAM. And 2Gb is the "sweet spot" for today's dual-core CPUs, and PCs running Vista - where "sweet spot" is where you get the most product (performance boost) for the money spent, and spending any more will get you much less, if any significantly noticeable gains.
Take note that it appears you are almost willing to do a full upgrade, certainly, up to, but just shy of replacing the motherboard. That's great! But note the "foundation" of any good computer must last through many upgrades, including motherboard upgrades. I personally think any money you would spend on more RAM would be better put towards a new case. The purpose of the case is to protect and cool. A good case and PSU will carry you through years of major upgrades.
The big PC makers build and design their cases with cost savings in mind - they do not want you to upgrade, they want you to buy a new computer. Your Dell case will surely have limited upgrade or added cooling options. It is not as bad as it used to be, but many PC makers used cost cutting and assembly techniques that made upgrading components impossible - such as using rivets, or bent metal instead of screws.
Just do this for me
before buying more RAM. For one week, keep an eye on your memory use in Task Manager > Performance tab, and note your system demands as shown in the Commit Charge (K) section:
Total = The amount of memory (in Kb) the OS and running programs have been allocated now (This is what is seen in the Page File Usage History graph)
Limit = Installed RAM + Virtual Memory (Page File)
Peak = The peak amount of memory (RAM and PF) you have used since you last booted
Pay particular attention to the Peak value. If that value never exceeds your installed RAM, the value shown in the Physical Memory (K) section for Total, then you don't need more RAM!
If your peak comes real close, then you should consider some for near future. But at that point, you may just want to add 2 X 512Mb to maintain your dual-channel setup as Doug talked about. Remember, 32-bit Windows only recognize a little more than 3Gb, if lucky.
I'm betting 2Gb is plenty for now, so IMO, the best upgrade path for you, one that best ensures the best use of hard earned money
for the long run - assuming you will have a computer, in one form or another, the rest of your life, is:
1. New PSU - based on
anticipated needs over the next couple years
2. New Graphics Card - this alone is going to give you a HUGE performance boost, way above and beyond any that you would see by adding more RAM.
Then, if there's money left in the budget,
3. New case
And finally, if money left over
4. Additional 1 Gb of RAM (2 X 512Mb).
Remember too, that one of the downsides of spending money to stretch the useful life of already aging technology is at some point, the gains are not worth it because you cannot carry that hardware over during upgrade.
For example, your motherboard supports DDR2 RAM. There are crossover motherboards (support both DDR2 and DDR3) now, but like the phase from AGP to PCIe, that just signals that DDR2 is phasing out. I suspect in 2 years, DDR2 motherboards will only be found on ebay. So, spending huge sums of money on an AGP graphics card now is not wise. Spending money on
more RAM may not be wise either - as neither hardware will be supported on your next motherboard - assuming you are like me - all my future "planned" purchases are expected to keep me in sight of the cutting edge.
Oh, I recommend you swap PSUs then run with that to make sure it works fine. Then your new video card. If you tear your PC down and install several new parts at once, and it does not power up, you will not know what caused the fault. One upgrade at a time.
I would think your current CPU would do fine for now. Again, just upgrading your graphics card should put a big smile on your face. To be safe, you need to research your motherboard to determine the biggest (most power hungry) CPU it will support that you might consider. Then use that to plug in the PSU calculator.