Upgrading Desktop Computer

I had this computer custom built and it has become outdated and wanted to upgrade. Actual use has been approximately one year as I have mostly used a laptop for the last few years.
Processor is an AMD Athlon XP 1600 1.40 GHZ.

I have been looking at hard drives and I see ATA on some and SATA on some, what is the difference?
I was thinking about going up to 1Terabyte, got lots of stuff to store. Do I need 7200 or 5400 RPM or does it matter?
What other factors, if any, do I need to consider when purchasing a harddrive?

Now have XP Pro and wanting to put windows 7 on it, have seen windows 8 and not impressed. What determines if I need 32 bit or 64 bit? Any other factors to consider?

The RAM is DDR -400mhz-CL3- PC 3200U-30330. When I have been shopping for memory, I have been seeing PC3200 without the 'U," does this matter?
Also, motherboard only has 3 memory slots, so can I just buy 1GB for each slot?

The processor is pretty fast and not looking to upgrade it but due to lack of RAM, memory is used up in hurry and slows computer down after about an hour of use.

Thanks much in advance for any advice.

 

LauraR,

Please delete. Duplicate post.