Lessee... My development box is a 3ghz P4 with a gig of ram and onboard
craptastic video.  I've got an 80 gig HD, and even with TONS of development
stuff loaded (2k5 Team System, 2k3 Enterprise, Windows Embedded Studio, all
the latest CTP's and SDK's, Office 2k3 Pro, Sql 2k and 2k5, etc etc) I still
have 17 gigs free.  

I can tell you that you don't want to run with less than a gig.  There's
just enough swapping to annoy.  As far as ghz, I'm okay with 3 (single core,
no HT).  There are times when I find myself waiting a few seconds for a
compile to finish, but it hasn't gotten to the point where I'm thinking of
upgrading.  The only truly frustrating thing is the onboard video.  I can't
do WPF stuff with it, and I get issues with screen draws causing the IDE to
not scroll smoothly and ugly form resizing.  A 50$ nVidia card would be well
worth the investment (if this damn motherboard had a vga slot).  So, a decent
dev box for 2k5 for developing a website with data access, all on the same
box, would be a 3ghz with a gig of memory and 100 gig HD and a 100$ video
card.  Definitely something you can put together for less than $600.  You can
then spend 400 on a big-a.s LCD (don't go widescreen unless you plan on
watching more movies than debugging code) and have a decent little system.

What William said!
Personally, I prefer (for a few $$ more), a dual core A64 and 2 gig of
memory which allows me multiple instances of VS (2003 and 2005) and other
development environments (Eclipse for Java) concurrently.

With the kind of 'tool-footprint' your talking about, max board ram( 1G
or better) and a processor over 2 gHz would certainly improve
performance.  The VS IDE, and SQL Server by themselves will need most
resources depending on how you run the SQLServer services; so if you
have other things running you could see some performance issues.

As an example:  I have a laptop with VS 2005 Pro, SQL Server 2005, on
XP Pro; hardware is Centrino M 725, 1 Ghz Ram, and 80 GB disk.

When I have VS 2005 open, and SQL Server running in the back ground,
the resources shrink by nearly 200 mg.  With an app running in the IDE,
use another 10 to 50 mb.  Add - ons and 3rd party stuff? It takes
resources.

I often have two or more instances of an IDE open, as well SQL
Management studio (another 50 mb), so my resources become very thin
indead.

If your system does a lot of paging to the disk, that could certainly
help slow things down in this situation, also.

Anyway, all that to say go for max if you can!