Upgrade when Crysis arrives and it is benchmarked. Stuff will be inevitably cheaper, and you will be able to make a well informed choice about which kit to buy.
However the urge to tweak is strong, and I couldn't even follow my own advice.
I have just gone for the mid-grade. Got the Core 2 Duo E4300 (oclocked to 2.7GHz) and the ASROCK 4 CORE VSTA for £107 total. This board has DDR, DDR II, AGP and PCI-E support. This satisfied my urge to tweak now.
I couldn't resist spending another £50 on 2Gigs of Kingston DDRII. Even though I should have waited for prices to drop more. When Crysis rolls around I will have the chance to get the most compelling DX10 card; ATi's new versus the established NVIDIA.