But when I look at the cost of the upgrades, I ask myself if I'm just better off combining that money with whatever I can sell my 1,1 for and putting it all toward a new 6,1 (or a nice used 5,1).
Went through this decision as well - here's my thoughts:
MP 1,1's are currently going for only small money on eBay (german site: between 650,- and 900,- Euro usually). CPU upgrade (2nd hand) is usually below 200, Ram may be a little expensive, so let's assume another 200 for 8GB. Makes a total of 1.300,- with a good price selling the 1,1 - for a new 8-core machine with comparable amount of memory you will probably easily have to pay more than twice as much (a little less for a refurb, but not that much less).
PLUS - if the MP will have a re-design as rumored, chances are that Rev.A will have its quirks.
All that made me opt for a CPU upgrade to comfortably wait another year or two before retiring my silvery powerhouse. By then (hopefully) the Thunderbolt transition will have worked out as well (things like effective speed, reliability, available peripherals, adoption in the PC world -> prices etc.), so decision parameters will be different anyway.
Admitted - i already have a SSD installed for my system and am perfectly fine with my "only" 12GB Ram, so it's "just" the CPU upgrade for me to bring my 5 year old machine's performance back on par with today's top-of-the-line iMac!