I won't believe that your friend's shows 4 GB in XP until I see a screenshot. It is widely known that in XP 32-bit, the OS can't see above 3 GB and doesn't use anything past that even if you have it. The 64-bit version does use past 3 GB though, so if he's running the 64-bit XP then it will definitely happen.
I'd fuck the police on SLI. SLI will never be worth it because of the limited games and apps that support it, and even if they do, you could buy a card a year from now that will be better than an SLI setup for the same price as the extra card. I simply can't recommend SLI. Trust me, one 8800 GTX is amazing enough.
An Enermax 500w+ will do the job, but going further certainly doesn't hurt anything if the price is right.