advantage of adding RAM is the fact that you it is relatively easy to add to your system. Takes less than a minute to replace.
The second choice really depends on what you do with your computer. If you are a gamer you might consider getting one of those new Geforce 8800 GT which start at $270 and make it possible to play Crysis and other high end games in high details. Again, check your computer to see if it supports AGP or PCI Express Video Cards before going out and buying one that does not fit.
