everything looks good. I would maybe consider getting the Abit NF7-S instead of that Gigabyte motherboard.
Also, if you have the money (or if he has the money), I wouldn't "save him the money and get a 2500+ Barton, and clock it up to 3000+." The last thing you want is your grandpa's computer to be overclocked

Just get the 3200+ and be done with it. That is, if money isn't the issue. Not to mention you would have to ditch that RAM and get some "good stuff." real good stuff. like Corsair XMS series (and pay twice as much for it). when you overclock, you have to upgrade your RAM to the stuff that will handle the overclock. I doubt that stuff you have listed would do it stabily
I would get an NEC or a Sony 17" monitor.