Which Macbook to buy?

I've currently got a 3 year old Dell desktop running XP and it's starting to get really slow no matter what I do. So, I'm looking at replacing it with a Macbook before the Dell totally dies. My budget isn't huge. I surf the net, do web-based email, basic photos, word processing/spreadsheets, and iTunes (I'm addicted to my iPod). I tend to keep 2-3 browser windows (or tabs, now) open at once (email, and other sites at once).
I'm looking at the base model Macbook. Would 1GB of RAM be enough for my usage? Or should I cough up the $150 for the extra 1GB of RAM? I'm not worried about only having 80MB of hard drive space, as I was never in the habit of keeping much on my hard drive. That's what external drives are for anyway. I was originally looking at the "middle model" and putting an extra 1GB of memory on it, but with that and AppleCare, I nearly choked when I saw the total. The only true extra I would add is iWorks.
And yes, I know I'd have to reformat my iPod. I'm planning on using a flash drive to transfer my few non-iTunes music files to the Macbook. I'd then just totally reformat the iPod to the Mac, realizing I'd have to reload everything on it, but it's mostly CDs, so that's no problem. I think I could transfer my few iTunes purchases somehow.
Thanks for helping this Mac newbie!
Also, if I choose to get my Macbook through the local Apple store, can I walk in and out with it in one visit, or do I have to wait for them to add iWorks and extra RAM?

Hi Tradd,
There's really no advantage to purchasing AppleCare within the first 90 days except for "peace of mind" knowing that you'll be enrolled and covered for three total years, from your first day. Now, on the 91st day you'll lose the free phone support and on the 366th day you'll lose the hardware support. In addition, on the 366th day you'll also lose the ability to enroll in the program as AppleCare must be purchased and linked to your computer within one year of you purchasing the machine.
If you opt to "delay" the purchase of AppleCare, also realize that there's no advantage in doing so. The price is still the same, the duration is still the same. The coverage is still three total years from the date of the computer's purchase, not the plan's activation. Just as there's no "pro-rated" fee to make AppleCare cheaper because you buy it when your computer is almost one year old.
One thing I should mention, if you choose to wait. Don't forget to buy AppleCare and activate within the first 365 days. If you "forget" or miss out, and wait past the deadline it'll be too late.
RAM is definitely an important component and the MacBook now supports up to 4.0GB of RAM. It's also fairly reasonable through 3rd party channels, if you opt not to go with Apple installed RAM. As someone who's on a budget, that might make sense to do.
As for the HD space issue, keep in mind that if you get an 80GB HD you're looking at about 67-68GB of available storage after the OS installed. Which is still plenty of storage space for music, movies, documents and games. It's just not a small arms cache, which some users prefer to have accessible on their machines at all times.

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