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What CPU and how much are you planning on OCing it?

Tough to say right now since it's not clear how prices of current Core 2 Quad and Extremes will be effected by the availability of Nehalem, but what were you leaning towards?

The best water cooling solutions unfortunately, are not bought as kits. They are assembled from parts bought individually and is a skill set all of its own. WC solutions made with hand picked components will definitely go over the $250 range, which is why it's important to know what your cooling needs are.

With a good air cooler in a case with excellent circulation and airflow, it's not out of the question to safely overclock a CPU to over 3.5ghz. QX6700 can be OCed to 4.1ghz on air at 1.735v at 74 degrees stable under load.

So, for most applications, it's not necessary to use a WC solution. In some cases (for many of the inexpensive kits) they actually perform the same or even worse than the best air coolers.