Better bang for the buck on CPU and motherboard with the E8400 or E8500. The I7 is faster for most applications but actually slighlty (I mean very slightly) slower than the Wolfdales for gaming.
Are you talking factory clock speeds or performance?
I benched an E8400 and a i7 920 using FarCry2's benching utility.
The 920 is OCed to 3.8 with the memory running at 739 x 2 (QPI) DDR3 3gb Triple channel 1gb x 3
The E8400 is OCed to 3.6 with a 1840 FSB, DDR3 4gb Dual Channel DDR3 1600 native 2gb x 2
Both machines have a GTX 280 SSC
Results the i7 performed just under 4x's the scores of the E8400. For a $240.00 processor this thing screams. Yes the MB's are in the 225+ range for good boards and good memory (cant slouch here) is 150 plus.
Since the i7's have eliminated the FSB and is now done with the QPI good fast memory now bases your overclocking ability more so then the processor. Put some OCZ 2000 into an i7 rig and got the 920 to 4.6 on 1.4 volts on the processor and 1.65 on the memory. Only problem was the processor still BSOD because of heat. Gonna H2O one and make a final decision. If your going i7 there is no need to get more then the 920 with its OCing ability and being a little less then 25 percent of the 965. 3.8 is an easy overclock on air for the 920 and keep your temps in the high 30s to low 50s OCed (reasonably)