I'd bet the Tualatin Celeron's are at least as fast as the these new Celerons. The advantage of the PIV core is that it'll run faster(High Clock), but do less work per cycle(Lower Instructions Per Cycle)... A 400MHz speed advantage is probably not enough to cover the PIV core, especially a castrated one.
I'd also think that a morgan duron, at maybe 1.3GHz or so, could give this a run for its money.
It'd be really interesting to see a budget computer shoot out, the contenders:
Tualatin P3-1.2GHz SDRAM
Tualatin CII-1.2GHz SDRAM
PIV Core Celeron-1.7GHz DDR and SDRAM
PIV 1.7GHz DDR and SDRAM
If only I ran a hardware site... <hint><hint>