The 1GB stock RAM chip in my girlfriend's Asus Eee PC was giving us problems, so I put in a 512MB one from a laptop I no longer use. The performance decrease was INSANE. She can no longer have iTunes open alongside anything else or it freezes completely. So my conclusion is not the most scientific one - but from personal experience I would say upgrading the RAM will be the most solid performance boost. Also, something to consider instead of a 7200 rpm HDD would be solid state technology. If you have a home server, store data on the cloud, have an external HD, or just not a lot of data, it would be a viable and solid option to put an 80GB SSD in your netbook. Alternately, you could put a 160GB SSD in, and not take a hit on capacity. Those aren't cheap though, as I'm sure you know