Not bad, but I'll take a few exceptions:

1 - cleaning up and defragmenting your hard disk is Windows specific.
The Microsoft block allocator is brain dead, was made that way, and will remain so for as long as Diskeeper and Norton Systemworks create revenue: a Mac OS X, xBSD or Linux-based system doesn't need defragmentation(*), as it is done by the OS on every disk access. You can get efficient defragmentation by:
- disabling System Restore: it doesn't work very well anyway, is a virus nest, and eats up to 6 Gb on your hard disk.
- setting your swap file to a fixed size.
- disabling file system indexing.
- deleting DrWatson's log.
- running Ccleaner once in a while with most settings enabled: once you have applied hotfixes, you don't need the uninstall files anyway. You'll need to clean up IE7's and WMP's patches yourself though.
- make Pagedefrag run at every boot after 0 second wait: the first time it may take a while to run, but it'll keep the Registry and swap file in one piece.

(*)to be fair, such a system may still fragment if you fill up a partition with huge files when it is already more than 80% full - Windows will fragment any file if you get past 10% partition capacity. Some say it's a way to prevent data corruption, as usually adjacent sectors are more likely to get corrupted, but then if that's the case Windows doesn't fragment ENOUGH.

2 - a resident antivirus is a resource drain.
Using a limited user account, a well configured firewall (in software or hardware, preferably both), and scanning downloaded files before you run them (and not making use of MS Outlook Express, which runs files for you) will keep you safe enough.
Not using IE may help, too: Opera or Firefox can operate as pure user level processes. Firefox 3 will be able to notify antivirus when a file is downloaded (if it interacts well with ClamAV, you can dump Norton and forget about the yearly AV tax).

3 - power surge protection.
A sound advice. However, a beefy PSU that you change every 1-2 years and a good power surge preventer are, in my experience, less costly and more efficient than a pack of batteries you'll need to renew every year. A good PSU in great shape can handle brown-outs, especially if your system doesn't draw too much current, and a surge protector will cover the PSU's most damaging attack. Changing the PSU regularly ensures that its capacitors remain at peak efficiency, and that its voltage regulators work as required. It is also unsound to clean up a PSU (it's dangerous!), so getting a new one is the most efficient way to get a clean one. With Vista, no UPS lasts long enough to allow you to save your files and shut down a system cleanly.

Milk eh?

I'd suggest keeping your files on a NAS drive or USB external drive and formatting your MS OS every year.

Besides running a limited account try Virtual Machines for avoiding those pesky viruses