My recomendation is the third: Gut it and make it the most expensive bed for a basset hound. This is because a Pentium D, even at 3.4GHz, is generally slower than even a 2.0GHz Core 2 Duo, let alone an i7. Plus, the Pentium D is now extremely old (7 to 8 years old), and severely outdated - so much that modern programs won't run correctly or at all on that system.
In other words, that PC is a near-complete waste of money at this point: Even $350 is way too high for such an ancient system. It is not worth more than $100 total - and nearly all of that is on the GTX 285, which is the only part that's even remotely salvageable from that PC. And the 10K RPM and 7.2K RPM hard drives in that PC are likely to be of very small capacity and of an equally archaic design that even the fastest of those are still slower than the slowest current 5.4K RPM "Green" hard drives.
You probably can use PPro CS3 on it but nothing better. And don't expect much in terms of speed. You've just wasted good money on something barely better than a door stop. I used to have a Core 2 duo 18 months ago and it would take me 90 minutes to render a 5 minute video. Your Pentium D is worse than my old set up.
Your machine "MAY" be good enough for PPro CS3 and even that is not certain. One thing for sure, don't expect much from it.
Thanks for the info, yeah I was looking at the newest version available from Premiere and the specs are pretty high. The thing I bought already comes with Ppro CS4 and After Effects (which I hear is like Photoshop for Video) and since the company I work for is switching to MP4 H.264 codec for web advertising, or the "new television" as they call it, my "quicktime/H.264" is kinda getting some weird stares, specially when the main boss is listening to a bunch of straight out the school-bus punks speaking quickly and going nuts over how they spent 6 hours on "enhancements" for 15 seconds of core (no fuss) editing. Could you believe not even half of them know how to make a garbage matte? they say they can do that with green screen and keying. the world is in trouble I tell you -_- the time I get replaced there it will be by a machine, telling me its here to save john connor.... (well I'm rambling now so I'll shut up)
I think that machine can handle 15 second of footage instead of the usual 30, so I'll see what happens if not my dog is gonna have the sickest bed ever...