OK OK OK, overclocking is free speed at the cost of free free and free. But in reality it has a number of costs that may not be for everyone.
Because my hat is off to the responsible overclocker, the person who GASP spends the time to learn all the variables, learn to sneak up and get a safe over clock, which takes much time and testing, are willing to spend the bucks it takes in faster memory and better cooling, and then back off a bit to get a stable overclock. And in addition has a real need to get more speed so that their passion of gaming or video encoding can be realized for less money invested.
The person I have lesser respect for is the person who decides he has to keep up with the Jones, and if someone else achieved this incredible overclock with the same CPU, they should be able to do it too without any time or knowledge invested.
I do not think our OP is in that position, but is asking the right questions about where to stop, and has gotten some good answers.
As for me, I now have an overclockable board and processor for the first time on my life, I have taken some baby steps in gaining knowledge and trying some overclocking, but because my needs are more in the area of stability rather than speed, I am still running stock speeds on my computer. When and if I need more speed, I will over clock.
But because my wife and I were fool enough to buy a too hot running a chip, I am having to underclock it just to run it stable.