For an i7 Core, it's 8 threaded, quite a good processor, but 1.6 GHz is slow - I assume that's idle/everyday use to keep the temporary down for laptop purposes? Turbos up to 2.8GHz which is more like the speed you want (2.4GHz min I recommend for gaming). Multi-core games will greatly improve using i7 Core.
6MB Cache on the processor - performance will depend on which level cache its in: level 1 cache being the smallest, closest and fastest, moving out up to level 3 cache being slower and larger.
As for the memory. The more memory in the graphic card, the better, for larger textures and higher resolutions (but the cost also increases hugely). The more memory on the computer depends on if you do a lot of multi-tasking, etc. I recommend depending on OS - WinXP 32bit 2GB+, Vista 32bit 4GB+, Win7 32bit 3GB+, WinXP 64bit 4GB+, Vista 64bit 6GB+, Win7 64bit 4GB+.
WinXP Pro 32bit SP3 is still the best and fastest benchmarked for hardcore gaming giving a higher frame rate but only supports DirectX9c. Vista 64bit is a memory hog. Win7 Ultimate 64bit is quite like Vista without so many of the issue, still pretty good for gaming as well as applications, looking pretty, etc.
Hard Drive : 500GB 5400 RPM - This HD is quite slow, standard speed today is 7200RPM, check RPM and also cache (higher the better) for faster the transfer rates.
With that graphic card and computer specs (virtual benchmark), playing HD movies will be awesome and smooth. Playing a FPS game like "Left 4 Dead 2" on med/high specs idle 60fps+, however in action drops to get around 30fps, as the rate drops it should be pretty fine to game on so long it doesn't go below 24fps. You might have a few bottlenecks. It's more targeted at video media by the looks, but can still handle games.
I'm not the best when it comes to laptops, but a hardcore gamer, hope that will be of help.