Getting genuine Windows key from a retail shop could cost you a lot and doesn't help you too much in your situation especially when your budget is low, try to check Garage Sales for cheap genuine key if you want but be careful on this, some might be selling duplicate/stolen key etc.

Intel Core i5 6402P - RM 715
Gigabyte H110M-DS2 (D4) - RM 249
Corsair 8GB DDR4 2133MHz Value RAM - RM 161
Gigabyte RX460 4GB GDDR5 Windforce OC - RM 630

Total: RM 1755 (Techview price inclusive of GST)

If your current Windows 7 key is an OEM key then you cannot transfer the ownership to new mobo because OEM key is tied to the first activated mobo, but there are few ways to get past this, like asking support from Microsoft (not guarantee will success, they might ask you to buy a new key instead) 
CPU upgrade is depends on the socket, so the upgrade room is pretty much locked to 2 generations (like Intel 6th and 7th gen both using LGA1151 socket), any upgrade beyond the same socket will require mobo upgrade too.

Intel Core i5 6402P - RM 715
Gigabyte H110M-DS2 (D4) - RM 249
Corsair 8GB DDR4 2133MHz Value RAM - RM 161
Gigabyte GTX10660 6GB GDDR5 Windforce OC - RM 1210
WD Blue 1TB HDD - RM 225
FSP Hexa+ 550W - RM 189
Tecware Alpha - RM 219

Total: RM 2968 (Techview price inclusive of GST)

If you want (or can) to go up to 3.3k, then you can upgrade the CPU to i5 6500 and add a 120GB SSD. And this specs can run most of the games on high (or ultra if the game is well optimized for PC) settings