The Core2Duo is a great step up from a single core, but it you're running a heavy game it's going to be using all of your power. You can't stream on something like that, I think. You'd be better off with a quad core or more, at equal or faster Megaherz.
The thing about 4GB of RAM is that you're only getting about 2.5GB of that, practically speaking. You're on 32-bit OS, so your vid card is taking up 1 GB of your ~3.5GB maximum.
You're rather hovering at the bare minimum requirements, when you consider that. I think you will need to run your games at low resolution and at low detail settings (if not minimum) to get any kind of smooth streaming feed.
If you're asking what you can upgrade to do better?
- CPU for more horsepower
- 64-bit Windows to use all your RAM
- maybe more RAM. I'm not sure if this streamer requires more graphics power to work, or if it works better on excess RAM, but the RAM requirements go up as you scroll through the different layers of requirements.