Macbook 2007 running hot, upgrades/service that can help?

In need of a little help if I can get any advice.
My mid-2007 Macbook is running WAY too loud hot and the battery, which always lasted for an average of 2-2.5 hours, is now only lasting for about 1-1.5 hours.  This is a new problem, might've started after I put iLife '11 on the computer, because it wasn't an issue about a month ago...I meet the required specs for running it, but I'm thinking this is what caused the problem.  It also seems to be taking longer to charge it.  My goal is to get this thing running better so I can get another 2 years out of it before I get I new laptop.  I've had it for just about 4 years now and I'd like to get to 6.
I'm running 10.6.7, iLife '11.
2.16 GHz Intel Core 2 Duo
2GB 667 MHz DDR2 SDRAM
Here is the battery info:
Here is the activity monitor:
I was thinking about getting a 2GB RAM card so that the computer is running 3GB instead of only 2, because I can barely run Parallels at this point without wanting to rip my hair out. 
I was also going to change to a 500gb HD as I only have 12gb left on the 320gb one that is in it now.  Figure it would help have more than about 3% of the HD space available on it.  Will removing some stuff of the hard drive now help?  Until I get the bigger one?  I can put a lot of my TV shows on an external and free up about 23gb for a total of 10% of the HD space free instead of 3%.
So, other than upgrading one of the 1gb ram cards to 2gb and putting in a new hard drive (I was going to go to 500, but now I'm thinking I should go to 640 or 750 instead so that I'm good for the next two years), what is recommended?  I can take it to get looked at by a local Mac service provider for $35.  They'll let me know of anything I need done and give me the option of it I want it or not.  Any thoughts?
Guess I'm just trying to figure out what I should concentrate on more?  Getting it looked at?  Adding the RAM? Freeing up HD space?  Something else?  I would like to wait for the upgrade in HD size so I can get bigger than 500gb.
And in regard to the HD:  Is it recommended to stay with the 5400rpm instead of going to 7200? Considering it is running hot I'd think I should stick with 5400rpm, 3.0gb/s, 8mb cache?  Any recommendations which one to go with?  I know I need to avoid ones with motion sensors...but what does that mean?  I see two 750gb models on Newegg, but neither say anything about that (Western Digital WD7500BPVT Scorpio Blue Mobile Hard Drive & Hitachi Travelstar 5K750 0J11563 2.5" Hard Drive)
THANKS!!!! :-)

You've asked about 10 questions in one post and that's not a good idea.  If you have 10 questions to ask then you get more replies if you start 10 separate threads.
Regarding your first question (overheating), try resetting the SMC: http://support.apple.com/kb/ht3964
and also resetting the PRAM: http://support.apple.com/kb/ht1379
Best wishes
Bob

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