Bus speed is important, and depending on the apps you run, you might notice it.
I do lots of java development, and I use a Celeron 1.3 overclocked to 1.4. It seems to do the trick although on extremely I/O intensive tasks like building large projects, I really notice the lag. The SiSoft Sandra benchmarks seem to say that the CPU is a good performer, thanks to the 256K of cache, but kinda lousy when it comes to memory throughput (as expected on my aging Abit BF6)
I guess another way to look at it is upgradability. A P4 rig is going to be a lot more upgradeable. But like you, I'd be very suspicious of the advertised 1.7 you speak of.
Good Luck.