Mine's about the same age, it's an early 2008 White MacBook. But has been upgraded to its max and it runs really well! I got it this week from eBay! I needed a laptop to take to collage and since I was on a budget this was the best choice!. Oh and the battery still holds a charge!
Mine is from late 2006, still my main computer, and running better than ever with 3Gb of ram and and SSD. I can't see any reason to replace it unless it dies.
It handles Lion very well, compared to Snow Leopard it boots even faster into Lion using the same SSD... Is it worth it to upgrade? I don't know... I upgraded to use the iCloud features but it turns out that those features are very limited even with Lion. (I have Mountain Lion on my other Mac) I guess I didn't research enough... But anyway, I am happy wit Lion so I am sticking with it...