You do not list your GPU in the above list so we can only guess but a quick search with google told me you might have this card:
ATI Radeon HD 4350 which has only 256MB RAM and this is your first bottleneck (if you have a different card please list it!!)
Your CPU is decent but also not the greatest.
Those 2 will limit your experience with Arma 2 / Arma 2: CO.
Make sure you run at least 1.59, try the latest beta, update your GPU graphics card drivers. Use only a viewdistance in game of like 2000 - 2500. Set your postprocess to "disabled", disbale vertical sync in your GPU settings. Set your resolution not too high, and set render to 100% or maybe 85% (not sure of the ammount, just check the ingame settings).