In case anyone's interested:
I've just completed an evaluation installation of Win 8 (let's not get into a Win 7/8 argument

) on a 2006 Dell GX620 with 2GB of RAM, formerly running 32 bit Win XP SP3. Took a while to work out whether the machine had 64 bit hardware - it did. The sticker on the box said it had a Pentium D CPU, but the boot screen and diagnostics said the CPU was a Pentium 4 - turned out not to be an issue. The Win 8 upgrade advisor wouldn't run, but the Win 7 advisor said the machine was OK for both 32 and 64 bit.
The biggest problem for me was that the evaluation was a complete fresh install with no further upgrade possible and the cheapest non-OEM Win 8 Pro software was an upgrade, so I needed a (free) way to get back to XP. In the end I found AOMEI backupper, which created a full backup on an external USB disk drive and a boot/restore CD. Most other programs wanted to charge for this functionality.
I went for the 32 bit version of Win 8, partly to conserve RAM and partly guessing that 32 bit drivers for old devices would be more readily available. Much to my surprise, in the end everything worked perfectly (sometimes only after several reboots). The Win 8 Skype didn't recognise the Microsoft USB web cam, so I followed advice and installed the desktop version, which cured the problem (and I much prefer the desktop programs to the Metro ones, anyway!)
The Win 8 upgrade disks (both 32 bit and 64 bit) are now on their way. So a Win 8 PC for £65.
To add to the paranoia over keeping XP: One comment I've seen talks about the black hat crowd looking at the next set of patches for other versions of Windows to find vulnerabilities that also exist in XP, then exploiting them. I know a good AV and firewall and keeping away from dodgy web sites are always good ideas, but if I can avoid the worry and have some techie fun for very little money, then I'm happy.