Can someone please explain to me what the benefit of these new processors is? It's hard to get a straight answer on how much these improve game performance.
It depends entirely on the game. Most are barely multi-threaded and use 1.5 CPUs at max (average), many not at all (only use one core) and I'm not aware of one that really fills a 4-core without speculative computing.
Wargames, I'm not aware of one that's multithreaded.
I have a quad-core but cannot really cite any benefit for gaming (albeit, there are some chess programs that do perform with greater strength while using a multi-core PC). Multitasking does seem to go more smoothly on my quad core than on my old PC but, then again, that could just be the age factor more than anything.
If you're buying a new CPU, I don't see any reason to stick with a single core unless your budget is very tight. According to the latest info on Pricewatch, almost the entire line of Intel Core 2 duo's are now selling for less than $200, some for less than $150.
With RAM and motherboard prices like they are, you can pick up a good deal on a motherboard/RAM/CPU deal for about $250. With prices like that, there's really no reason not to get a dual core.
Prices are not too bad on quad core, either. I just upgraded my machine with a new quad 9450 and EVGA 790i Ultra SLI with 4GB DDR3 memory. Although I haven't done any formal testing, it does seem noticeably snappier than the core 2 duo previously installed.
Games will SLOWLY come out with Multi-Threading such as Fallout 3 (whcih specifically says on the back that it's multi-core compatible meaning it uses more than one core) and I would recommend getting a E8500 3.16GHz (overclocked to 4GHz with a cooler) - and you can get that one for like NZ$385, which is in the midrange but it's solid and stable. I do alot of 3D gaming as well as 3D animation and Quad cores are just redundant as they dont fully use all the cores.
If you are looking to future proof your system, then go with quad core.
Honestly for gaming I don't see the need for quad core yet. Games are finally taking advantage of multicore now, so upgrading from my dual core now seems overkill.