C64 emulation is still choppy even on 1ghz turbo mode. I think this is down to the code needing more optimisation for the specific arm type used on the pi. I haven't experimented with the memory split yet though. With a 512mb pi I might put the memory split upto 100mb for graphics. That might also help in the long run.
Also the power supply I got was from maplin and came as part of the kit I bought. It's a 2A max supply. However it will switch between 1A and 1.5A.