Answer to first question is no.   They would just not cover the new card, the card MFG would.

To second question, yes the 8400s PSU will handle higher power cards.  If you are going with the X1600 I would recommend the XT and not the PRO. And if your serious about gaming go for something in the X1800 or X1900 Series.

I would recommend if you upgrade installing the drivers from the installation disc or the latest one from the ATI website.  It's not hard to uninstall the old drivers, just uninstall everything that says ATI in the ADD/REMOVE Menu.

Pentium 4 660 @ 3.6 GHz. 2MB L2 Cache 64 bit 800 FSB HT.
Intel 945G. MB. ---- 2 Gigs Samsung PC 4200 DDR2 533 MHz.
W.D.160 Gig. 7200rpm 8 mb cache HD. ---- S.B. Audigy 2 ZS.
Floppy & 16X DVD Rom. and Dual Layer DVD & CD Burner.
XP Professional & Office XP Pro. 2003 Edition.
eVGA 7900 GT CO Superclock @ 590/1750.
OCZ Modstream 520 Watt PSU---Gateway FPD1975 LCD(8ms)
Logitech Z-3 2.1 Speakers---Belkin Nostromo N52 Speedpad
Logitech MX 518 Gaming Mouse----Func 1030 Gaming Surface.
Logitech Momo Racing Wheel & Pedals
3dMark06----- 5032

Thanks for the reply! 

Just to clarify on the third question, so I should remove the ATI video drivers and programs first before installing the new card and then reboot the system with new video card and install the new drivers?

Window XP will boot up without the new drivers install yet right? 

Sorry for all the questions, but just want to make sure I don't trash my system by mistake...heard some horror stories before on video upgrades.

Yes,  you have to uninstall the old drivers before you shut down the PC and disconnect it from power to install the new video card.   Don't forget to hook up the external power connection on card if it has one.

PC will boot up under the Windows drivers and after log in if the new hardware wizard keeps popping up just keep clicking Cancel till it goes away.  Now you can install new drivers from installation disc or the ATI website.

If you install the latest drivers from the ATI website your PC will scroll slowly while under Windows drivers but it is nothing to worry about as it will return to normal after the new drivers are installed.

EDIT:  Also don't forget to install monitor cable to new card before booting up.    I'm sorry if some of these instructions sound stupid but they are mistakes people who don't do this often make.

XPS400--Pentium D 830@3.0 GHz--1 Gig PC5300 DDR2@667MHz
GigaByte X800XL PCI-E@430/1080--- Stock 375 Watt PSU.
Dell UltraSharp 1905FP 19" LCD.

E510---Pentium 4 630@3.0GHz--1 Gig Corsair PC4200@533MHz
XFX 6800GS PCI-E@485/1100----OCZ Modstream 450 Watt PSU.
Dell E196FP 19" LCD.

Gateway E6500D-- Pent.4 660@3.6 GHz 800MHz FSB HT.
2Gigs Samsung PC4200@533MHz
eVGA 7900GT CO Superclock @ 590/1750
OCZ Modstream 520 Watt PSU.--Gatway FPD 1975 19" LCD(8ms)

Message Edited by Oletymer on 06-21-200612:50 AM

Thank you so much for the info, Oletymer!