Since you say it is a MacBook that would mean it's an Intel-based processor.
If that is the case, the only sane thing to do is upgrade to Snow Leopard. Running anything else on an Intel machine is nuts.
I'd recommend the Mac Box Set, which gets you Snow Leopard plus the latest iLife and iWork for one low price ($150ish). Also, max out the RAM if you can.
You have to be already running 10.6 in order to upgrade to 10.7, which is coming out next month. Luckily, it's only $30.