I don't know how well Longhorn/Vista will run on anything but a high-end laptop platform (expensive++).
As other people have said, only heavy-duty games (actually more dependent on the GPU) and major number-crunching apps strain the 32-bit platform.
The absence of drivers is a worry (likely to be even worse than for Linux for the forseeable future).
Much as I like AMD, I'd go for a Pentium M solution (probably the 745 with 2MB L2 cache at 1.80 GHz and 400 MHz FSB) with 1GB of memory and a decent GPU - there must be some good bargains out there at half the price of a 64-bit solution.