I was thinking about updating it to windows xp, adding more RAM, better processor, new hard drives, wifi card, and maybe even adding a dvd drive and a blu-ray burner
Upgrade to windaz 2k and leave it at that. Spend the cash for extra memory, cpu, wifi card and optical drives on your next machine. You'll be far better off. All you are doing is suiting hardware and software around an ancient motherboard, and it's costing you alot for no extra gain.
What are you looking to use it for? RAM is usually a cheap useful upgrade for old machines, and a DVD drive is only 25$ and might be useable on your next machine as well (It depends if your next motherboard supports IDE or not). I wouldn't bother with a new CPU as that would mean you need a new motherboard and basically an altogether new machine. There's always a possibility of finding an old CPU that will fit your current motherboard but they'll probably be priced high and treated more as an antique than a useful component (as I found when trying to buy some SDRAM for an old machine).
I'm on the win2K bandwagon on this one as well. Spending more than 40$ on ram and 25$ on a dvd drive and you're better off using that money later on for a completely new build.
Edit: On second thought a machine like this is a perfect setup for running linux on. If you're into that sort of thing you'd be able to have an up to date OS that will still run well on old hardware. I'd only use 2K if you happened to have a copy laying around, not worth spending any money on it.
If it is pre-DVD, then don't waist any money on it. Old memory is actauly more expensive than DDR2 memory, it will not support SATA, so an upgraded DVD drive would not be very transferable to your next system. As for linux, it will not run very fast on such an old machine (or at least the programs won't run very fast). On top of everything else, the machine is at least 9 years old and it has been stored in a garage; who knows how much longer it will last anyway.
..actually a Win98-era pc would be ideal for Linux, there are distro's specifically geared towards old machines..
Granted it'd still be unsuitable for HTPC use, i was thinking more that the machine would still be usable as a simple surfing machine, it'd probably be suited for actually using for surfing within that garage..
