If you install the 64-bits version of windows XP it will recognize all of your RAM. Yes there is a performance gain but you might not notice it. There are 64-bits version of most of the software available today.
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Phenom X4 9850 BE
Gigabyte GA-MA790X-DS4
2GB Kingston DDR2 800
Radeon HD 3450
WD5000AAKS 500 GB
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