Buying a new computer or upgrading is good

It depends on what you are looking for. But if I were you, I would upgrade the RAM to 1GB and upgrade from 2.21Ghz to 2.51Ghz. If you want to be playing games, you need a good graphics card like NVIDIA or GeForce. They are both awesome brands.

Well it depends upon how u'll gonna be using ur computer.. if you are a gamer or a multimedia pro then the above config won't do at all.. get urself atleast 4GB RAM and Intel C2D 7xxx or above. But if u just wanna use your computer for internet surfing and watching movies then the above config will also do.. but get ur self a dedicted gfx card if u r into HighDef movies.