You definitely need a better graphics card. I tested the demo on a 8600 GT on medium/high settings and had <10 FPS. My CPU is roughly equivalent to yours.
Right now I have a 9600 GT and it runs way better.
You might as well go for a 9800 GT(X) or a Radeon 48XX, but these need much more power. I´d recommend them only if your power supply has 600 W or more. For example, my 500 W PSU couldn´t handle a RADEON 4850.
And doubling your RAM surely will help.
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