My experience with building custom rigs is pretty minimal. I have never built a gaming PC, but I have thrown together workable PCs out of essentially Frankenstein parts. My current "gamer" is one I bought stock and it works well for me.
That said, I'd start by ditching Vista for XP; as far as I have heard, XP is still best for gaming. As far as hardware goes, I can't get too specific myself, but if you are trying to do this on a lower budget, focus only on what you need. Keep the speakers you have, you probably won't need a great CD/DVD drive, etc etc. For a mouse, if you are looking for a change, I highly recommend the Logitech Mx518. Just about any monitor will do, despite what people will say. 2GB of RAM is a tad bit low. Not gonna check your processor specs, but I'd go for at least dual-core. For the graphics card, and you should just go for what's the best within your price range.
Kinda jumbled advice, but it's a start. To sum it up: Only focus on what will increase your FPS, and skimp on the rest.
Assume that everything I say is or could be a lie.