You can slap some memory and any old HDD in there and give either WHS evaluation
or WHS2 (Vail) Beta
a try just to show that it's more than enough for media/NAS/backup/server uses. WHS is really nice to have for home and work, and WHS2 seems to be a good update. The beta is limited in what it's capable of doing thus far, but it's just a test. It should run around $100 once final, but you can't upgrade from BETA to Final Release meaning the server will start over from scratch.
Just as a reference, I used a Pentium4 651/2GB DDR2 667/2x 500G HDD's and it worked fine. It's now updated (E4600/2G DDR2 800/4 1TB HDD's) just because the parts were around and feel the HDD updated it more than anything. A Q6600 didn't help it one bit, so it got pulled for better uses. The CPU just isn't taxed so you can underclock/undervolt
it pretty far to keep it really cool and quiet, and perhaps stash it in a nook where it's out of sight. FWIW, I'm trying out the BETA with an IDE 120G drive on better hardware than the main WHS and it's fairly slow to transfer or begin reading media.
Not sure about a game server. It'll work for internal LAN's, but could be hindered by your ISP's upload speed if you want an externally pointed game server. There, memory helps too.