yes, it's a good video editing rig, and no, it's not the same as a 1.6 GHz.
The biggest bottleneck you will have in that machine will not be the CPUs, when you are encoding, you will want to have the source and destination on different HDDs.
That's a good deal on that machine. If you get it, invest in a SATA controller, and pick up a couple fast drives, and you'll be good to go.
EDIT: I just noticed the SCSI drives in your post.
That is a great price for all that.
EDIT 2: I need to read more closely....AND A MONITOR!!! Buy it now. It will serve you well.