Okay, first-
-Core 2 duo? I believe that's old tech. I have it in my outdated laptop. May still work for some gaming, but for a gaming computer and your higher budget, quad core is definitely better.
-Vista? NOooooooooo. Vista is a resource hog and is incompatible with a lot of software.
So then, here are my suggestions.
I absolutely recommend www.newegg.com as the place to buy your parts. Many people purchase the components to build whole computers there. Awesome site. Makes choosing parts VERY easy. And their RMA is incredible should a part be DOA or defective in some way.
First, choose the processor that you want. Pick between the two major manufacturers, AMD or Intel. With AMD you can usually get more bang for your buck. The higher the GHz, the faster the computer. And more cores is better too. AMD currently has hex core processors available. Better than quad cores. I recommend the AMD Phenom II. If you decide on going with Intel, go with at least a core i5 but a core i7 is better. (Those are the processor names, not how many cores they have. Intel only goes up to quad core right now.)
Next, choose your motherboard. It needs to have the same socket type as your processor. (Check tech specs) ASUS, Gigabyte, MSI and Intel are the namebrands. Zotac is okay, but better to pick from one of the other brands. Make sure that the FSB is around 2600 MHz or close. Make sure the motherboard has plenty of expansion slots for later board additions such as graphics cards and WiFi cards. PCI Express slots are your friend here, but they don't ALL have to be that, just two or three depending on how many graphics cards you want if you plan on including those in your build. You can build a good computer on a micro-ATX board, but if you want a lrger one, ATX is okay. Micro-ATX should be all that you need though.
RAM is the next step. Check your motherboard specs again. You ideally want a motherboard that supports DDR3 RAM. So then based on whether you need DDR3 or DDR2 memory, check out RAM in those categories. Also check the clock speed. (Common ones are 800, 1333, 1066, and 1600.) I dont recommend anything with a clock speed less than 1333 MHz. And when you want 4GB of RAM, (Or however much you want- I suggest at least 4GB.) it is better to get one stick of 4GB RAM than two sticks of 2GB RAM or two 4GB sticks rather than four 2GB sticks, etc. Good namebrand is a must in picking RAM as you may end up with a bad stick otherwise. GSkill, Corsair, Kingston, and Mushkin are good brands. I have seen okay reviews on OCZ brand as well.
Pick a hard drive next. The higher the RPM the better. Don't go for anything less than 7200 RPM. If you can afford it, get a solid state drive for your OS as it will increase your load times for the OS and generally increase OS functionality. I use only Western Digital- they are one of the BEST brands out there. Second place would be Seagate and Hitachi is probably okay as well. I would suggest going for at least 500GB. Don't go above 1TB because drives above that size tend to be unstable and may fail early on.
Pick a disk drive as well. You'll want fast read and write speeds. I suggest if you want a combo drive that reads AND burns, that you look under the DVD burners section. Make sure that the disk drive you like has both read and write speeds in the specs, unless you are okay with having a separate disk drive for each of those two tasks.
If you want a graphics card, I can't help you much here as I have little experience with them. I haven't used one before. They are essential to a good gaming PC though. Good namebrands are EVGA, Saphire and Gigabyte. Make sure that they go into a PCI Express slot as this will give you the best performance.
You need something to power all this. Modular power supplies are nice, because you don't have to have all the cords in the way, you can just keep the extras in a bag somewhere else. But that's not a necessity, it's just convenient. Place your system specs into here to get a recommendation for a power supply. http://c1.neweggimages.com/BizIntell/tool/psucalc/index.html?cm_sp=Cat32_PowerSupply_left-_-PowerSupplyFinder030510-_-http://promotions.newegg.com/productfinders/powersupply.jpg Always shoot a little higher than the recommendation so that you can power any components that you add at a later date. This is another component that should be namebrand because it may fail early on otherwise. Choose between Antec, Corsair, and Thermaltake are best. EZCool is okay if you're a little low on cash now.
Lastly, is the case. There are a LOT of different brands and cool designs. www.xoxide.com is a good place to look. Ccheck the reviews to see if the case is sturdy and well liked. Also check its specs to make sure it supports your motherboard size.
Oh, and go for Windows 7. Home premium at least, but Ultimate is better. For your PC, I recommend 64 bit.
Well, I believe I covered everything.
Hope this helped! :-)