I forgot to mention one important thing, we are not using native items so performance should be good
Your configuration is not bad. In terms of gaming I'd say one more ram module would make a huge difference, they are cheap after all. When it comes to your processor, any Dual Core Intel above 2.0 GHz can run games pretty decent. On the other hand 1.8GHz can't run well.
Lot of things can cause the CTD's, it can be bad module, corrupted save, if you haven't adjusted the game like turning on l
oad_texture_on_demand and
force_single_threading button, etc.. What mod causes you CTD's?