I have an older HP Mini, the 1035NR, it has the GMA950 in it which does ok on old games but struggles to keep up with anything from about two years ago.
I installed a Broadcom Crystal HD card in it so it can hardware accelerate videos, with the latest Flash 10.1 and a few other programs that support it. I am wondering if they will be coming out with updates so you could us it for gaming, because then it would be really useful.
If you really want to game on a netbook you should pony up and get the Alienware MX11. They reviewed it at CES and it is really awesome. A little pricey and you can't easily switch between the graphics card, but still the best thing for mobile gaming.
MX11:Alienware MX11