I defiantly recommend that you over clock the CPU, not sure how far the E7400 can go though, I reckon you could easily get 3.2GHz. Not on the stock cooling fan though.. if you want a cheap cooler then I'd recommend a Cooler Master 212 Evo
I have the older 212 Plus on my E8400 and I can get to 3.85GHz no problem - could get 4.25GHz but due to my motherboard I can't give it any more voltage to keep it stable (I'm way within the safe boundary that Intel rates it to)
You should be able to play MW2, MW3 at close to maximum settings depending on your monitor resolution. Although I don't think you would get away with GTA IV on a dual core CPU - I have a E8400 @3.85GHZ and two Nvidia GTX 260 216 in SLI and I struggle to play it comfortably at 1920x1200.. It's defiantly playable but not smooth constant FPS that you'd get in MW2 etc.
Stay away from the large towns, don't trust anyone unless you know them ofc lol, if chased by zeds then go into a building as they can only walk inside. Head off the the country side and look in barns etc for stuff. Deer stands are also good to find items.
If you only want GT5 for the highway track then don't bother lol.. the standard car models are fine, the cockpit view in GT5 is awful anyway and that's the same with Forza.
If you drive with chase cam then that's even worse.. So the majority of the time driving with the 'bumper cam' you don't see the car models, the physics don't change so what's the matter?