Watercooling can get lower temps. It can also get less noise. With knowledge and care, it can get both.
As to overclocking, with the A64 chips it seems that there's not a lot high-end air can't do which water can. To go the extra step you need phase-change or peltiers. Having said that, water does have the potential to cool as well as high-end air while making a lot less noise. Water will take the heat to a much bigger area (a radiator) which can be cooled by a bigger, slower-revving (and thus quieter) fan. Or if the rad is big enough and of the right type, it can even be cooled passively. OTOH, aggressive air cooling with powerful fans can pull temps down to within a few degrees of ambient. This is not likely to increase your overclock, but maybe the length of your ePenis.
If you want to do it, do it. "Because it's there" is a perfectly valid reason in my book.
For waterblocks, think Swiftech and Danger Den. Widely available (can get good bargains on used blocks) and great performers. For pumps, Eheim, Hydor, Liang-li (is that the name? can't remember), Swiftech and more are popular. You can use any aquarium water pump though. You're looking for head pressure rather than flow rate, the more waterblocks you have or the more restrictive the design, the more head pressure you need for your pump.
For tubing, pick 3/8" or 1/2" ID. Won't make more than a couple of degrees difference. Try not to interchange between them too much though. Avoid sharp bends and right-angles, they kill flow. Tygon and vinyl tubing are recommended. Tygon is more expensive but also more durable. Try to stay away from cheap, clear plastic Home Depot specials. They may split, kink or leak.
For radiators, try Black Ice Pro or Black Ice Extreme (BIP or BIX). You can also get a heatercore from a car, although you have to add the hose barbs yourself. If you're interested, go to the Hardforums and look up "2Fresh". He sells pre-modded heatercores at very reasonable prices, paints them to your specifications and can also hook you up with other accessories.
Low-flow, quiet fans don't cope well with a rad more than 1" thick. Definitely use a shroud, less noise and better airflow.
Don't forget to add something to the water to kill bacteria and prevent corrosion. Antifreeze, Zerex additives, water wetter etc. are all good.
Good sites for watercooling info, don't forget the forums:
www.overclockers.com
www.xtremesystems.org
www.hardocp.com
www.procooling.com
