The last system(s) that I built were core duo's so it been a while. I'm not up to speed about the latest and greatest.
What do I gain/lose by using a 775 quad CPU over a 1055 CPU? (using a i5 series)
Today current Sandy Bridge CPUs are much more capable and efficient than two gens LGA 775, a i3 2100 is faster than Q8400, so my suggestion is to build around Sandy bridge, depending on your needs. i5 2500k is atm the best bang for gaming, really good cpu that allows overclocking, at $200 there is nothing that can compete with it. That said, the i3 are also very good cpus for the money, specially since you are not building a pure gaming pc. Depending on your CPU needs, there is also the Sandy Bridge Pentiums and Celerons that will be cheaper, and still very capable cpus. Check the CPUs for whatever VM you will be doing, as not all are capable of doing everything, some have limitation due to design and hardware.
I would check i3 2100, its a $99 cpu if you have a microcenter near you, or $120 online, comes with intel HD2000 and i3 2105 comes with intels HD3000 (so is the i5 2500K), im not familiar with BioWare's Star Wars, so idk if you do need a dedicated GPU, my guess is you do, but im not sure. The Q08 can fit almost any dedicated GPU, maybe would help a little more info about the games you kids play in terms of specs, to decided into a dedicated GPU. The Q11 is also an option, similar to the Q08 but smaller (sort of speak) only a single 140mm cools the pc, it can still fit 2x 3.5 hdds on the bottom and has a optical drive on the top, you could probably fit the ssd below the hdds. Check this two threads for ideas into what you might be getting into, Mini ITX H67 Silent Gaming System
and mATX mobo in Lian Li Q11 mini-ITX build
(careful with this one, as he used a special micro ATX mobo to allow the placement of the HR02 and the Shamman).
On the mobo, there are lots of options, i would consider any H67 mobo (maybe even H61 but be careful here as not all have Sata III, HDMI, and PCIe 16x, in case you will use a dedicated GPU), when im not OCing, my personal preference is Intel mobos out of bieng the most efficient, but they also the least tweakable, Intel DH67CFB3
could be an option, so are many others Asus, MSI, AsRock, Gigabyte, etc, pair it with i3 2100
+ Crucial M4
and you will end up with very capable mini itx pc.