54°C for a 1800+ Palomino cored version is pretty normal... kinda. it's a bit on the high side but at least it's within specs - I would worry if it's over 60°C.
My Pally 2000+ runs at 49°C on load, case interior at around 30°C thanks to several fans and the Chenming 601 style case - the 49 deg celsius one was achieved by using Arctic Silver 3 (thermal compound) and the ThermalTake Volcano 9+ heatsink/fan combo - they might not be the best thing out there, but at least it keeps everything cool. I hope.
You could always go out and buy a 2100+ Thoroughbred-B core or a 1700+ (likewise) for either 70 bucks (or 45 bucks) for it and you won't lose an arm and a leg. I've been thinking about getting either one of these CPUs lately, but now that I'm going to make an important financial decision next month, I'm going to slide off the thoro-B upgrades and wait for the Athlon 64's to come out and start the upgrades from there.
If you have some cash to fork over for those CPU's - feel free to do so, and the reasons why I recommended you the two CPUs I listed was because they overclock magnificently (upwards to Athlon XP's 2800+ rating) and of course they're a lot cooler than the Palominos.
BTW Modas.. nice case, and nice price tag

My case was paid for around $119 along with 420 watt power supply included (that one gave out a couple of months ago... cheap-a**ed brand.

)
I'm seriously thinking about heading back to AH (without the free trial,

- that's how I came back the last time around) and fly with you guys once again, but we'll see what happens next month on this "purchasing a vehicle" thing.
TIGS