It is simple and easy just copy over your old drive to new one and see how it reacts. Obviously the ram should be bigger and will help.
Installing lion osx to the new drive will be much easier with the lion osx created on media via USB, sdhc or dvd, It is a matter of clean install over the existing osx.
The whole process from copying to new drive, to install to new drive,upgrade ram and should not be over 2 hours.