I have more of a computer hardware background then financial markets so I hope this is of help.
One's hardware requirment is really contingent on what sorts of applications are utilized as well as to what level, which I believe everyone has a decent understanding of what their requirment is. For instance, someone who is has a long term discretionary trading style will be fine with a 400mhz computer running a 15" monitor. On the other hand, we have quite a few traders (here possibly) that day trade and have multiple monitors and are running mulitple applications in conjunction, and it all varies with each person. So one really has to determine for oneself how much hardware power is needed.
For instance, I have a 250mhz Cyrix based system that runs XP that I use for general use, and I just acquired a dual AMD Athlon 1600+ MP with Tyan motherboard system to run some analysis since I like the confort of having instant feedback from the computer even with high intensive applications. The payoff is well worth it since I'm on the computer so much, the responsiveness of the computer is a huge pay off for the increase cost in hardware.
If you've got money to burn, go with SCSI. If not, I'd recommend a Western Digital Second Edition (SE) hard drives. They have one of the best benchmarks and are what I run in my IDE setup. Don't be fooled into believe ATA133 is "faster" than ATA100. That's like saying a Intel chip running at 1.5ghz is faster than a AMD running at 1.4ghz
On the topic of monitors, the reason why I believe people see a boost in either resolution or computer performance from an increase in memory is because many times if the computer doesn't believe that the video card has enough onboard memory, it will actually utilize some of the system memory in order to compensate. So you're essentially "extending" the video card onboard memory, so to speak.
Hope this is of little help.
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All of the above information could be and probably is misinformation. Please act accordingly.