I'd definitely recommend a 2nd monitor (I run my main toon on my main monitor, the other 4 take a quarter each of the 2nd monitor). It makes the experience so much nicer, and is also truly useful outside of WoW.

You'll get by on 4GB (assuming you really have about 3GB spare for WoW) - each copy of WoW takes about 500-600MB - but you'll be wishing you had more (which means an operating system upgrade to a 64-bit version).
Dalaran will be a no-go area though, unless you only play 1 or 2 toons at a time.

I'm just about to upgrade to 8GB (I have vista 64), and I'm confident that will make a big improvement to my experience, especially in Dalaran.