Yes, hardware upgrades are certainly cheap at this point. Regarding the reduction of component life due to overclocking, you are certainly correct. However, going from 10 years to 5 years doesn't really matter that much to me. Really though, the key is getting a good chip that doesn't require a big bump in the core voltage. There is quite a bit of research regarding the Northwood chip available on AnandTech.
I began overclocking when I built my first Warbirds rig, and that was a 300a Celery running at 450. It ran as a workstation for more than a year, and then as a server 24/7 for another couple of years. I finally had to retire it in favor of the servers you see above. I've built several OC'd rigs, and have never had a component failure (knock on wood). Though I've made a few other painful mistakes
AnandTech will provide some other great info on hardware, and I trust the reviews there better than anywhere else. If you are curious about modifying the case similar to what I did (cold cathode etc) you can check out Pimp Rig,
http://www.pimprig.com, there are other sites too.
Don't blame me if you develop a hardware addiction though
