It's pretty simple.
CPUChoose from:
AMD or Intel? (Pretty much equal)
There's all sorts of new processors (CPUs) coming out all the time, I really can't tell you what to get. There's a huge selection, varying in frequency (measured in GHz), number of cores, etc.
MoboConsider:
Socket - depends on CPU type. Different CPUs uses different sockets.
PCI-e - depends on graphics card. All new graphics cards use PCI-e.
SATA or IDE - depends on hard drive. All new hard drives use SATA.
RAM Slots - how many RAM sticks do you plan to stick in there?
Graphics cardChoose from: ATi or nVidia. Again, pretty much equal.
Consider: DX10 compatability. Does it have it? Getting a DX10 card is a good investment, seeing as how most new games take advantage of it. However, the prices are still a bit quirky, and both ATi and nVidia are releasing budget versions of their prime DX10 cards.
Then again, for your price range, maybe a last-gen graphics card would be optimal? Very powerful, but not DX10-compliant, cards are available for as low as $80 these days. I'm talking Radeon X1800 and the like. They're more than enough to run source and most new games (they do have SM2 support, probably 3 too), so one of those might be a better choice.
RAMConsider: How much do you want, basically? Anything less than 2 Gigabyte can't run Vista, but 1 Gig is more than enough for Source.
Brands: Corsair is considered the best RAM brand around (afaik). There're a lot of generic brands out there.
Peripherals
- Sound card? If you have a good sound system (5.1 setups and stuff), you might wanna invest in a good sound card. If you don't, just go with the onboard mobo sound, in my opinion.
Use guides and reviews, like on
Tom's Hardware when choosing hardware components. For instance, their graphic card comparisons and recommendations are great. Their "Best-hardware-for-your-money of the month" thingy is especially great when hunting budget cards.
It's a jungle, I know. But there's really not that much to it when you get down to it.
If there's any mistakes or embarassing omissions that people notice, please do correct me. Hardware never was my strongest point.