I run a similar setup. Intel Celeron 2.2ghz, 256MB (32 stole for intergrated GPU) DDR 266mhz RAM, and a 40Gb IDE harddrive. I managed to get 125mhz x 22 for a clock speed of 2750mhz (2.7Ghz) This was all on stock voltage, stock cooling, and my load temps sneak up to the mid 50 line and stay there. Stability has been checked, and passes in my books. So please don't lose hope on your CPU...
First, make sure you have decent case cooling, get all the dusties out of there.
Second, get familiar with your BIOS, I bet it will have limited options, like mine did.
Third, as you bump up the FSB check the CPU and RAM for stability, and over heating.
Good luck with your overclock, and please post your results when you're done.
~Bryan~