Alrighty, I have a Dell Inspiron 1526 and I just feel like I was screwed when my parents got me a 'work' model. I can run all of the games here, but a few just barely. And I can't even run The Witcher or Rainbow Six Vegas 2. So, I was wondering what CPU(s) and graphics cards are in a reasonable price range, are laptop compatible, and can run games up to now. Any help is appreciated.

You might be able to change the CPU, depending on wether it's soldered to the motherboard or fastened by some socket, now I'm not sure exactly what CPU is in your machine (Dell says there are 6 possible choices - click on the "Tech Specs" tab), but you should be able to put in almost any AMD Mobile CPU (emphasis on mobile) using the same socket, which seems to be Socket S1, but I give no guarantees on how well the BIOS handles CPU's that are not on the linked Dell page.
As for graphics - you're pretty much screwed, very few laptops have replaceable graphics cards (I do believe some Alienware laptops do, but I'm not sure), and while the Radeon Express in your box probably is better than most Intel chips, it's not much to brag about.

Most laptops you won't be able to change much beyond the hard drive and ram. They tend to get built fairly close to their thermal budget. And don't even think of trying to change the proc or vid card in a dell. Your best bet is to just get a different one.

Laptops are typically designed to be as non-upgradable as the manufacturer can make them. You may be able to upgrade to a CPU that is a little bit faster than the one you have, but that's about it. There is no guarantee even there.
If you're at all interested in modern gaming then your investment should be in a self-built desktop. If you want a portable gaming platform then get a DS or something like that instead. Laptops aren't really suited to gaming - the Alienware ones are just overpriced bad jokes.

When it comes to gaming computers...
Cheap, powerful, portable... pick two. ^_^

Well advice #1, Technical has only one L
Advice 2: http://www.engadget.com/2007/01/08/hands-on-with-the-asus-xg-station-external-gpu/

This
There maybe ways you can upgrade your laptop but they wont be worth it in the long run. Do what I did and buy one part at a time and the best you can afford. Start with a case and psu and build up from there. You can put together a system that will run most games with a modest outlay.

someone hook that up to an eeepc

I'm pretty sure the Atom CPU might become a bottleneck in that case

The XG Station isn't all it seems to be. The demo was great, but they were also comparing it to a GMA 945, and they aren't even saying how much shared ram they're dedicating to the 945. If I remember correctly the real issue with the XG was the bandwidth of the connection. Wasn't fast enough to do any real gaming. (Express 1x if my memory serves).
Sure it'll probably be a bit of a boost, but not nearly as much as you would think, or is warranted by the price of the box + vid card.
Once again you're back to really just buying a desktop system or a new laptop if you really want to do gaming.

I know that on the Asus n10j the Atom is bottle-necking the 9300m in it. Sure it helps and it's day and night difference, just don't expect it to game at the level of a desktop.

Yeah its not an ideal solution but it might be workable, especially considering the alternative is opening the laptop and whipping out the soldering iron.

Buy RAM. Cheapest and easiest laptop upgrade with a pretty decent performance increase. If you don't know enough to know laptop upgrades are difficult, you don't know enough to upgrade it any other way without destroying it. It comes with what 2g? If so, upgrade to 4g. FYI, middle-market laptops aren't built for powergaming anyway.
Also in games, turn off shadows - that's the least essential feature that uses the most horsepower.
Also, thank your parents. When I was your age, I was lucky if I got a birthday card. That's pretty nice of them.

I was thankful, and I still am because I can still run most games I have.
Everything else...FUCK.
Thanks everyone.

Fixed that for you