Even if you ignore the fact that Core 2 Duo is dual core. Its a totally different beast to a P4.
If you took a Core2 Duo, and disabled the second core, it would still blow away any P4 based computer. Its simply a better more efficient processor. Especially in gaming where Core2 really kicks P4 where it hurts. In many games Max framerates are limited by the GPU's still, but even so if you look at the minimum framerates, the Core2 systems often show their strengths.
Some might say that Core 2 is overkill for gaming because of the GPU limitations, however I say it just leaves more potential, as new graphics cards come out, you can just upgrade and not worry that your CPU will be a bottleneck.
So, to recap, a Core 2 Duo beats the living daylights out of any P4 in single threaded applications, and in the future when software makes better use of the second core it will be ready waiting.
Of course XP already makes use of the second core, so even if the programs you have right now arnt designed with dual core in mind, the Core 2 Duo will happily run 2 single threaded programs at the same time, and assign a different core to each task, and XP itself will always be using some processor power for the OS functions, these will make use the of the multi cores as well, so there should be some improvement in windows performance on a dual core system.