When we heard HP was building its latest TouchSmart with Intel’s Core i7 processor, we figured it was game-over for the competition: Lenovo and Sony use quad-cores, too, but they both tapped Intel’s Core 2 Quad. MSI picked an even less capable Core 2 Duo (and priced its machine accordingly). But when the benchmarking dust had cleared, HP sat in third place across the board. What happened?

We should have remembered that HP likes to use mobile processors in its TouchSmart line. In this case, a 1.6GHz Core i7-720QM. That’s a capable enough proc, but the older (and cheaper) Core 2 Quad that Lenovo and Sony picked is a desktop model running at 2.66GHz. So even the larger cache, integrated memory controller, Hyper-Threading, Turbo Boost technology, and other goodies tucked inside the Core i7-720QM don’t compensate for the mobile proc’s lower clock speed.

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Most readers know the name iBuypower by now, but they don’t know our nickname for the company: iStealpower.

OK, that’s not really true, we just made that up to make this story sound sexier, but there is some truth to our jest. Over the years, we’ve often wondered how the hell these guys can offer PCs for less than the cost of the parts. You know, like getting $2,900 worth of parts in a machine that cost $2,200.

We’re not sure if the cost of the parts in iBuypower’s Paladin F exceeds the price of the machine, but it probably gets close. The Paladin F sports Intel’s new hotness: the hexa-core 3.33GHz Core i7-980X (clocked up to 3.8GHz). Even with AMD’s new hexa-core CPU now on the market, Intel’s Core i7-980X is still clearly the recognized fastest CPU in der verold! To the 980X, iBuypower adds Nvidia’s top-dog GeForce GTX 480 card, aka Fermi. Also aboard are 6GB of Kingston DDR3/1600, a 1-kilowatt PSU, an LG Blu-ray combo drive, a 1.5TB hard drive, and RAID 0 SSDs, along with Windows 7 Home Premium. The entire system is embedded in a Zalman GS1000 Plus enclosure.

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It’s no secret that Nvidia’s GeForce GTX 480 cards are the hottest piece of technology people want to gawk at right now. Hell, we were barely able to obtain one of these coveted babies for our feature on Fermi this month.

So we were pretty impressed to crack open Maingear’s new Shift system and find three GTX 480 boards running in tri-SLI. That the company could rate such bounty is testament to its street cred among power users.

The Shift isn’t just about the Fermi cards, though. Maingear also managed to get that other big star of the PC world in for the ride: Intel’s Core i7-980X, which, with help from the Acetek water cooler, Maingear pushes from the stock 3.33GHz to 4.2GHz.

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Evaluating successive generations of HP’s TouchSmart series reminds us of shopping for a new car. If you fall in love and buy this year’s model, you must never, ever visit the showroom to look at next year’s model or you’ll be hit with a bout of buyer’s remorse faster than you can say “planned obsolescence.”

We’re not suggesting that HP is intentionally designing these machines to have a shorter-than-normal useful life or that it’s been adding frivolous features to new models; it’s just that the company’s engineers keep making design improvements that are significant enough for us to wonder why we heaped such praise on the previous iteration. The changes this year are a wee bit more incremental, but HP gets a major assist from Microsoft in the form of Windows 7, which is not only vastly superior to Vista but also offers far better native support for HP’s touch applications. Fortunately, owners of previous-generation TouchSmarts have the option of upgrading to Windows 7 and downloading the latest version of HP’s software.

But let’s get back to the matter at hand: Just what makes the TouchSmart 600-1055 so damned sweet? There’s the display, for starters. Last year’s model had a 22-inch display with a native resolution of 1680x1050; this one has a 23-inch screen with a native resolution of 1920x1080, making it the perfect partner for both the slot-feed Blu-ray drive and the integrated HDTV tuner.

Continue reading this review after the jump.