I recently was giving away some old P3 and P4 machines and was surprised by the level of interest in P4 machines. As you can see from my page on computer power use  the power use from a P4 system is significantly greater than that of a P3. The conventional wisdom is that the P4 takes 1.5 times as many clock cycles to perform an instruction as a P3, the old SPEC CPU2000 results  seem to indicate that a 1.5GHz P4 will be about 20% faster than a 1GHz P3, but as the P4 has significantly higher memory bandwidth the benefit may be significantly greater for memory intensive applications.
But generally as a rule of thumb I would not expect a low-end P4 desktop system (EG 1.5GHz) to give much benefit over a high-end P3 desktop system (1GHz for a desktop), and a 2GHz P4 server system probably won’t give any real benefit over a 1.4GHz P3 server system. So in terms of CPU use a P4 doesn’t really offer much.
One significant limitation of many P3 systems (and most name-brand P3 desktop systems) is the fact that the Intel chipsets limited the system to 512M of RAM. This really causes problems when you want to run Xen or similar technologies. I have a few P4 1.5GHz systems that have three PC-133 DIMM sockets allowing up to 768M of RAM (it seems that PC-133 DIMMs only go up to 256M in size – at least the ones that cost less than the value of the machine). Another issue is USB 2.0 which seems to be supported on most of the early P4 systems but none of the P3 systems.
512M of RAM is plenty for light desktop use and small servers, my Thinkpad (my main machine) had only 768M of RAM until very recently and it was only Xen that compelled me to upgrade. The extra power use of a P4 is significant, my 1.5GHz P4 desktop systems use significantly more power than a Celeron 2.4GHz (which is a much faster machine and supports more RAM etc). Low-end P4 systems have little going for them except for 50% more RAM (maybe – depends on how many sockets are on the motherboard) and USB 2.0.
So it seems strange that people want to upgrade from a P3 system to a P4.