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I have an Acer Aspire 3690. It has a 1.86ghz processor, 512mb RAM and a 80gb hard disk. It's alright, can't play many games or anything but I can chat and go on the Internet, etc on here so it's good enough. Just make sure you buy it with XP and not Vista, or if you buy it with Vista, replace it with XP. Mine came with Vista and it took about 10 minutes to boot up. I replaced it with XP and now it takes about a minute.
have a look on the dell outlet as you can get amazing bargains there if you are prepared to accept slight cosmetic damage to a laptop, eg. a scratch on the case
I would go for 1GB ram, 80GB hard drive and an intel core duo cpu and try to avoid a shared graphics card if you can.
I think this is great value http://www.ebuyer.com/product/132290
Seems ok to me. I dont know much about computers to be honest but Acer are good and supposed to be very reliable.
I have an acer 5652 had it for about 2 years and not had any problems. I would keep looking see if you can find a dual core one within your budget.