You said that you have two (2) 512 MB RAM chips on your computer, most frequetly, they can be the source of trouble. Maybe the timings on your chips are mis-matched, or they are of different brands, have them checked out. If you replace the 2 chips with one DIMM of 1gb, that should eliminate your problem. The Second thing to check is your CPUs operating temperature, make sure that the heatsink is secured to the CPU and there is a thin layer of thermal paste on it. Make sure that your CPU fan is running properly
Also make sure that there is adequate airflow through your cabinet. Your power supply seems to be fine. I wouldn't rush to change it. The coolemaster and Anatek powersupplys cost a lot of money. Before making an investment, it would be wiser to check your system.
You can check the processor temp with some free utillities that you can download from the net eg.
www.downloads.com,
www.softpedia.com or something like that.
If there are no issues with the RAM and Cooling, then have a look at your drivers, make sure that you have the latest drivers for all the hardware that you are using. Since you are using a genuine copy of Windows, I suggest that you also ensure that you have all the lastest updates and Service Pack 2 for windows XP. Good luck
You can also reduce the load on the power supply by un-pluggin the CD-Writer cause you already have a DVD writer installed, so you can brun CDs and DVDs from the same drive...unless you really need it.
Don't buy into what your local dealers say. Most of the time these guys are really clueless. They don't have a systematic way of troubleshooting a system and just rush to replace components... Your system will hang sometimes, it happens to the best of them, there is no such thing as a HANG (CrASH) free computer. Not with windows, linux even OS X Crashes... if it crashes like 10 times a day, then you have a problem. Heck, even dumb phones hang sometimes!