Another vote for Omega Drivers. I've been using then since I got my laptops. Omegas have been good to me so I'll stick with them. Tried a few others, but they all gave me problems (modded desktop divers, DNA, Unian....).
I find that a mouse pad is VERY necessary if you play lots of FPS's or do photoediting. I'm using a Razr Diamondback (upgrading to Copperhead next month) on an Exactmat. Teflon feet on a Teflon mousepad makes a world of difference.
Like others have said, I'd recommend a desktop hard drive. Either WD Cavier SE with 8mb of cache or a Seagate Barracuda drive. I think you can get 250 gb for around $120 nowadays. I'd also recommend this...
Netgear router with the firewall on
Disabled SSID broadcast
128bit WPA encryption.
Mac address filtering
On the computer:
PC-Cillin Internet Security with security settings on high
Depends what you want to do with it. I am currently using it as a secondary computer. As you've stated, the weakness is it only has a 64mb x300. It's enough for everything except heavy gaming. (Although HL2 and CS:S work flawlessly...
Security: PC-cillin Internet Security (cheaper and better than Norton b/c it uses less resources), Spy-Bot, Ad-aware, Hi-jack This!, SMAC
General Software (in no particular order)