The amount of RAM on the video card has almost nothing to do with performance. All other factors being equal, less RAM will only cause a slight amount of slowness if the game is using very detailed textures (like Crysis or other newer games). 256MB or video ram should be more than enough for a single instance of WoW. If you run more than one instance of WoW though, then you may want more video RAM. However, if you are going to spend money on a new card, don't worry about the amount of RAM on it. Just pay attention to real world benchmarks on places like Tom's Hardware. Many companies use marketing hype and put more RAM on slower cards to lure people into thinking they are better.

As far as your question about what to upgrade, Intel's Core 2 procs are a decent bit faster than AMD's current line, although AMD's tend to be cheaper. I upgraded from an AMD Athlon X2 3800+ to an Intel Core 2 Quad and it made a HUGE difference (had an 8800GTX and 2GB RAM in both situations)

Edit - found this on the Burning Crusade system requirements page:
PC System Requirements

* OS: Windows 2000 (Service Pack 4) or Windows XP (Service Pack 2)
* Processor: Intel Pentium3 800MHz or AMD Athlon 800MHz
* Memory:
o Minimum: 512 MB RAM
o Recommended: 1GB RAM
* Video:
o Minimum: 32MB 3D graphics processor with Hardware Transform and Lighting, such as an NVIDIA GeForce 2 class card or above
o Recommended: 64MB VRAM 3D graphics processor with Vertex and Pixel Shader capability, such as an NVIDIA GeForce FX 5700 class card or above
* Sound: DirectX-compatible sound card

So just multiply the recommended numbers for each instance of WoW you are running and that should approximate what you need. =)

BTW, the 7900gt is a (nearly) 2 year old architecture. I've had my 8800GTX for a year now. The 7900 series came out about 6 months before the 8800gtx, but it is still based on the 7xxx series architecture.