Should be able to, but I don't think anyone has tried it yet to confirm it. I'd get a service manual to see what components you need exactly, but I believe you will at least need the following 3 items:
logic board ($329),
heatsink A ($119) and
heatsink B ($249). So $700 plus the price of your Xeon 5500s and less whatever you sell the old components for, though there may not be much of a market for a used single socket board and heatsink.
edit: Might be worth considering the difference between refurb units is $650 ($2,149 vs $2,799) and the two 2.26Hz Xeons and 3GB extra memory have more value than the 2.66Ghz, board and heatsink of the single socket Mac Pro. Also you will probably be limited to the current Xeons, so it might be even better to buy what you need now and sell it and buy whatever is current when the time comes.