I recently switched from an o/c 4.4GHz I5-3570k to a 3.4GHZ Xeon (I7) with hyper-threading (I still have the I5, so could swap it back, but will stick with the Xeon do to its greater performance). I found it gave a noticeable performance boost in many things including recent AAA games which utilise >4 cores (even with 4 core games, background tasks run on the other threads). Hyper-threading works very well and Windows 7 utilises all threads very well, assigning any running tasks to different threads. I think the old issues from years ago, with hyper-threading hindering games, are non-existent. Watching task manager, I can see a nice spread of usage across all threads when several tasks are running and even just background tasks.
Add to that the Xeon using <45W flat out, it's a nice cool efficient CPU.