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Would it make a big difference which processor I used on my dedicated server: The Intel Xeon 3450 (Dual Core) 1 GB DDR2 Memory or the Intel Xeon 3040 (Dual Core) 8 GB DDR2 Memory for my website http://www.ilovecheaptravel.com ? My site has really slowed down since I switched to a VPS hosting plan with 256mb of RAM.
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AFAIK web servers are RAM sensitive (for stuff like caching pages and databases). However, a faster CPU might help if you enable compression to minimize page size during transmission. But I would say go with the greater amount of RAM.

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