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The best bang for your buck will come from these things in order.

1. 7200 RPM Hard Drives.
2. At least 256mb of Ram.
3. 32mb Ram on a video card.

Processor speed won't make nearly as much of a difference as these things will, although, you don't want to skimp on processor. Athlon 1800 or better or a P4 2GHZ or better.

I won't buy a drive under 40gb in size but frankly, 40gb is a whole bunch of space. 120 is overkill.

512k Ram is great! Gig is better! It boils down to your cost point. 256mb is enough if you run XP. 128 is bare minimum for XP an I wouldn't recommend it. It will run fine at 128, but performance will take a hit if you run alot of things.

As others suggested...Dells are good if they fit the criteria listed above and most do. E-machines can run great but you can get lemons. I've had vendors provide equipment driven by E-machines. The biggest issue is proprietary case and proprietary and substandard power supply. Generally the Emachines work ok, but I've trashed 2 of 5 within a 18 months. They stopped working and I just replaced them rather than deal with it. Of course, I deal with hundreds of PCs at work so it would cost more to bother with them than to replace(Down equipment can run into the hundreds of $$ per hour lost production).

As another suggested, you might find a local PC house that can build to order. You'll get your best bang for the buck there and if it breaks, you can go there, flop it on the counter and say "fix it".

Don't get the 3 year warranty from anyone. If you computer lasts a year, it's prolly good for 3 and by the time 3 years roll by, you'll want to upgrade anyway.

My .02.

Good luck.

-Mal