To your CPU question I would not be upgrading from an E2*** at 3GHz to another duel core the gains would be negligible. If you really wanted to upgrade CPU I would be looking at the E5200, you will definetly see bigger gains spending the money on graphics grunt.
So assuming you can RMA your board and can get an identical replacement then I would be tepted to sell the board when you get it back and add that money to your £300 with that you could buy an X38 or X48 motherboard (perhaps the DFI DK X38-TS2R £105 on Scan) add in 2x 4850's for £200 - £260. That may require a new PSU as well so perhaps a new board P5Q-Pro (~£90) and a 4870 1GB or a GTX260.
You mention wanting more RAM potentially do you run Vista 64 or are you running a 32 bit OS? If your still on 32 bit then remember a 1GB graphics card will reduce the maximum addressible system memory to ~2.75GB. So if you plan to crossfire 2x 1GB 4850's then you better be on a 64 bit OS
and if you have a 1GB card the extra RAM will be of dubious value £30 for 0.75GB poor value.