A lightly used i5/i7 with a bunch of RAM and an SSD would be a much, much better host.

I rescued a Dell workstation with an i7-950 from disposal, and added 2 disks and some RAM (9GB). Still not as quick as a 2500k in a lot of stuff but great for anything I can throw at it (decent size MySQL DB, lots of Rails apps, and quite a bit of web traffic). I could bump it up to 24GB but that's still $250 worth of RAM, new.