Depends on how much your time is worth to you. I don't mind burning a DVD every couple of years and reinstalling windows. It's kind of cleansing.
More memory would probably help some. Depending on how many programs you run at once and how much ram they like, you ought to have 1 or 2 gigs of memory.
Also don't forget to optimize your hard drive.
None of these things is going to make your machine radically faster. But it might be enough to keep you satisfied with your machine for another year or two.
Another thing to consider. It may not be your "machine" that is slowing down. If you have been following instructions, Microsoft has been pushing updates to you. Those updates make your machine more secure, but you can bet none of them have improved your computer's performance.
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"Against stupidity the gods themselves contend in vain."
-- Friedrich Schiller
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