Time to build a new server and scatch the old one? How big?

I have a client right now who has a HP ML 330 server running a 2.4gig CPU,
1gig memory and two IDE 80 gig drives that are mirrored and SBS came
installed on it. The server is having performance issues, especially when I
tried to load CRM on it(yes, I followed chapter 15). I uninstalled CRM and
the server is still not performing correctly. It takes forever to shutdown
and startup even. Right now they are having random issues with the server
and I'm at the point where I'm tempted to just backup and reinstall the
system. The company has 7 workstations connected and then 5 tablets
connected locally and over the internet when out in the field. The company
now wants to add a terminal server for remote users. So here are the
questions.

1. Does it make sense to decomishion the existing server and repalce it with
a new one?
2. Should CRM be housed on the server as well.
3. Does it make sense to upgrade the memory and add a second CPU to the
existing server.
4. If I get a new server, what specs should I fill. I was considering a Dell
1800 with dual 3.0 processors, 2gig memory, 2 -40 mirrrored SATA drives for
the OS and then 3 250 GIG drives for the database, email and file serving.
Would this be enough to handle the company as it grows to 30 or 40 users?

Thanks for the input everyone.
.

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