[zeropointbug]

Overclocking is simply put, getting much more out of your CPU that it would at default speeds. Say, you have three choices of CPU's, a 2.8Ghz, 3Ghz, 3.2Ghz and the costs of each are 180, 210, and 300 respectively. Now, obviously the two cheaper ones have much better performance/dollar. So, if you do your buying right, get a decent motherboard and a good heatsink, you can drastically increase the clock speed or "Ghz" of your CPU. So, seeing as all three of these CPU's are basically identical, except for the fact that they are binned differently as far as quality (how they would handle high heat, high stress situations), the higher clocked ones can handle just a little bit more, but not much really. So, when you overclock, you can either OC as far as you can on default CPU core volts (which is pretty easy these days), or you can increase the core volts and take it much further, provided you have a good heatsink.

So, take the $210 3ghz chip for example, relatively comparable what you would get with a real CPU these days, you could increase clock speed to 3.6ghz to 3.8ghz (depends on your luck, as not all components are made equal). Now if you want to take it further, you can increase core volts from say 1.25 default volts to 1.35 volts (or vcore), then, you should be able to increase the speed up to 4.0ghz, or even 4.2ghz.

So you can see that by getting a lower end chip and getting a better heatsink instead with the money you save, you can increase the clock speed far past the most expensive chip model.

I would recommend a heatsink such as the Noctua NH-U12P, as it is very quiet and performs very well.