The RAM is very simple.
Turn the laptop over, you will see a panel secured by two screws. Unscrew those two screws, remove the panel. Install RAM (insert it at a 45-degree angle, and push the module in *all the way*, then snap it down). Screw the panel back in. The real performance benefit of this is when you have many programs open at once.
Yes, there is an amazing difference in performance going from a 4200rpm hard drive to 7200rpm hard drive. 7200rpm hard drive, 1024MB RAM, and a clean reformat / install of Windows XP Pro turns this cute little notebook into a screaming beast. I'm running Windows XP Pro, SQL Server, IIS, VMWare, Word, Outlook, Visio, and six sessions of Internet Explorer, and a internet radio through Windows Media Player,and it's still ready for more.
Swapping out a hard drive isn't too difficult, if you've ever opened a laptop chassis before. Just unscrew the screws at the bottom, remove the keyboard, unscrew and remove the top chassis cover, and then you will have access to the hard drive cage. Take the old hard drive out, and either clone it (with a 2.5" to 3.5" IDE converter and a program like DiskImage or Norton Ghost) or put new hard drive in and do a clean format of your OS.
And yes, E5C's are quite nice! Isolating canalphones + DVD on an airplane, is a little slice of heaven in coach class.