Yeah, the x2 will make the computer feel much smoother.
The 3200+ would be fine, but I would consider going all the way and getting the 3800+ single core if you are going that way. That's a good processor
Actually, I would aim for the 3500+. Games don't seem to respond to much more than a 2.2 ghz AMD64 in my experience, unless you have an awesome processor. 2.0 ghz seems just a little slow for games like FEAR and Far Cry.
Hope that helps
Nat