I hate to say it but "repairing" your system to let you use your old components has painted you into a corner regarding how much value you'll get from upgrading on that platform.
You'd have probably been better off going for a modern motherboard with pci-e only vid slot and supporting only DDR2, then getting whatever vid card and memory you could afford until you could get decent upgrades for those. You are right to be concerned about the power supply, but you'll get a better answer by digging into the support forums and tech specs at the various vid card manufacturers websites.
You ought to be able to get a decent ASUS mobo for socket775 for under $75. 2GB of DDR2-800 to match will run you maybe $30-$35, tops. You can get a cheapo pci-e vid card that will destroy your current vid card for well under $100, but if you can go up to $125ish you could get a pretty decent last-gen card like the 8800 or 9800, or a current gen lower-end ati card which might offer better bang for the buck.
DDR2-800 ought to be capable of running slower than 800 and it's probably the same price as DDR2-667, so get ddr2-800 if you upgrade the memory. I recently bought 4gb (2x2gb sticks) of DDR2-1033 for $70 after rebates, so there is no reason why 2 gb of slower DDR2-800 should cost more than half that.
As for hard drive, 500gb drives run $70 or less now. You would want to go with SATA if possible since the newer drives are faster overall than the older PATA drives. This has nothing to do with PATA vs. SATA, just that the newer drives themselves are faster/quieter/cooler.