Well, this turned out to be real bummer... Both nVidia 7600GT AND the 2 gig of DDR400 memory turned out to be defective, except none of them were showing "obvious" signs of malfunctioning hardware up until I tested 1st couple of games.
AGP card was working fine throughout the Vista installation & beyond, up to the 1st benchmark now that I think about it. Then it started having random "holes" in the models/textures & misaligned polygons. The same problem showed up in Half-Life 2, and was still there regardless of updating the drivers and/or tinkering with AGP fast-write feature in BIOS, so I'm pretty sure it's hardware issue and not a software one. Oh well, now I have to source a replacement AGP card for this thing!
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The RAM issue(s) were more harder to find & diagnose however. Everything worked perfectly fine up until I did a memory test, that's when MemTest86+ showed me tons of warnings
So I did the obvious thing, I removed the other module & tried to start up the machine with only just one module, but the system hanged upon boot & wasn't responding to keyboard or showing signs of disk activity. So I tried with 2nd module instead, and it worked up OK until the memory test when I (once again) ended up with error during the memory test. It was only just one error though, but still error nevertheless. So I gave up & ordered a matching pair of two DDR400 modules online, 1GB each & will advise here once they arrive. In the meantime, I'll see if there's anything I can do about the video card, maybe even swapping out the PSU.