Hardware for PG

Hello all:

I could use some recommendations for what kind of hardware to throw at my
database system. It will be postgres 7.2 running under RedHat, most likely
on Intel hardware. The application is not very large. The data is probably
no more than 5 gig, no query returns more than a few thousand rows, and the
joins, though frequent, are of at best medium complexity, generally
involving no more than 4-5 tables.

The application is front-ended by PHP running under Apache on Linux. The
database activity is probably moderately biased toward reading rather than
writing. Individual users tend to pull up one fairly complex record at a
time (special education forms) and edit it page by page.

The biggest concern is not really query speed, or even raw transaction
speed, but scalability under multiple users. What do I need, hardware-wise,
to try to maximize the number of simultaneous open connections?

I'm considering a fairly middle-of-the-road Dell PowerEdge, 2 gig RAM,
1.2GHz Xeon, and possibly a RAID 5 array. Is this overkill? How much, if at
all, will PG benefit from additional processors?

Thanks for any thoughts,

steve