Dual core is supposedly nice for overall system smoothness and to let you do more than one thing at once. For example, I hate burning full DVDs and don't make enough backups, because I can't do anything else with my computer while burning because if I spike the cpu usage by accident, I've just burned a coaster. Dual layer DVDs are still expensive enough and take long enough to burn that I don't like doing that.
So I'm considering getting a 4200 or other X2 cpu to replace my 3700, before AMD drops the product line entirely. I waited too long to upgrade my laptop cpu (it requires 400mhz dothan) while waiting for the price to drop, but the 400mhz 2.0ghz dothans never dropped below about $350 so I never bought one. Now they're really tough to find and I may never get the chance to max out the cpu on my laptop.
Anyhow, the faster x2 socket 939 cpus would be a decent upgrade from a 3400, but you probably will only see a small improvement in games until more games start using dual cpus better. But you may see an improvement in overall system usability from the second core. Lots of computer parts reviewers have sworn to never return to single core cpus after their first dual core cpu review, whether it's amd or intel, simply because the dual core systems just feel more responsive during heavy multitasking use.
It's only a couple hundred bucks... Yea that video card is pretty old too and could probably use an upgrade but vid cards will still be around a year from now, while socket 939 cpus will probably not.