I'm looking to replace an old family computer with something more contemporary, it will be primarily used for playing games. Budget in the region of £300, less would be desirable but it could stretch if needed.

I think the main technical difficulty would be I've got a micro-ATX case and would like to stick to micro-ATX. How much of an issue would this be with modern middle of the range graphics cards and processors (both from physically fitting it in and cooling)?

I'm not interested in overclocking/RAID/anything else fancy.

So basically I'd be looking to get:
A power supply
Graphics card
Processor
micro-ATX motherboard
RAM
Hard drive - smallish but needs to be replaced as the current one makes funny noises
An OS - probably Vista Premium

I'd be grateful for any thoughts and suggestions as to the best combination of these bits for around the £300 mark with an emphasis on gaming?

I would help but I honestly know nothing about M-ATX...

If someone else picks out a board I can price around it...

jakg, it's the same thing mostly. the only significant change is the dimensions (24cm x 24cm max)
(every motherboard i had was/is uATX)

Built a budget pc for a friend yesterday so i'll just post the specs (replaced the ATX board with µATX).
Don't know the prices in the UK ,but it should be under or very close to 300£

DFI LANparty JR P45-T2RS
2GB PC6400 DDR2
INTEL CORE 2 DUO E7200
WESTERN DIGITAL 160GB
ATI HD3850
XILENCE 450W SILENCE POWER SUPPLY

I'd try to get a Nvidia 9600GT over a 3850. they are about the same price if you look around, and the 9600 is better. 7200 is a very good cpu.

yup looks like the 9600gt is slightly better (but also slighty more expensive). eats less power too.

make sure it is not EVGA there's been word around they have issues.

Going for this power supply and this motherboard with a E7200 and a BFG 8800GT (OcUK don't have 3850s and I'd rather order from one place to get this order reasonably quickly), is this an ok choice?

Looks fine to me and the 8800GT is better than the 9600GT & HD3850.