X1300 is WEAK. The X1600 which ATI rolled out to be the mainstream competition against the 7600GT got crushed. The X1600 is 2 "steps" above the X1300. It's not even remotely as powerful as the X800's from the previous generation. Basically, it isn't worth the time of day.
Heck, you can get betterMOBILE GPU's in alot of Dell's laptops then that has in it. I mean...if all you want to do is play games that are a year or 2 old now, surf the net, and do some productivity stuff, then that computer is PERFECT. But if you want to get your mone's worth, then it'd be best to keep looking.
Edit: Ok, here's a quick, rough, and dirty build for you from memory.
E6300 - 180
Gigabyte S3 - 115
Evga 7600GT - 110
1GB 800Mhz RAM - ~110-130, depending
Ta'da. You can use your old hard drive till you can get another one. You can either use Linux, or you could even use Vista RC1 as your OS till you can get the cash for an actual OS later. That computer will be FASTER, and BETTER. A new HDD will be ~100 bucks for a good, 250-350GB model. Sound, you can use the integrated. Ethernet comes with that board. Honestly, what more do you need. YOu're saving money. Buy a cheap case and read the directions, and install it.