Those temperatures look fine for a Northwood Processor - mine, a Intel P4 2.8C, runs around 44C on load and 31C on idle. Now that I read further in your post, 55C to 60C is a bit on the high side - that's when you should probably start looking around. For the temperatures, be sure that you have good air circulation within the case. Then, I just did this the other day to see temps go down drastically, but clean out the inside of your comptuer if you haven't done so in the past - I just did it and I saw a whole layer of dust blocking air from going from my HSF to Heat Sink.
As for performance, I'd doubt the temperature would be a determiner - 60C is hot, but the processor should be able to handle that. Try running Prime95 for a few hours (optimally 24 hours) and see how high the temperatures get on a single task. If it passes, the temperature is not a cause of the FPS dropping. If so, then some major cleaning or reapplication of thermal paste may be needed. Tell us how it goes
kram
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