A bit late to the party, but maybe it is still helpful:
I did exactly what you were looking to do - upgrading form the lower Core2Duo board to the i5 board (the board should be the same as the i7 board, as other people have successfully upgraded just the CPU on the i5 board to an i7). It works without problems so far.
I took the board from a working i5 model with several other defects (not related to the board of course). Disassembling was not complicated, but took a lot of time because I was too cautious. If you follow the teardown guide and use a bit of force for some of the plastic parts which stick to the back of the case (around the PSU, CPU heatsink and LED board), then you should be fine.
It is easy if you do it in the correct order:
1) glass panel, display, display cables (look at the guides)
2) graphics card, hard disk, optical drive, optical fan and all their cables (not needed, but makes room for the PSU and makes everything easier)
3) mark all cables from the board with (colored) labels to not forget them later (optional) and remove them (required)
4) disconnect and remove LED driver board; remove PSU board (PSU can also be just flipped around into the empty hard disk space if you don't like to mess with the cables)
5) remove CPU fan and the infrared sensor (look at the guides)
6) now you can carefully remove the logicboard including heatsink and change it for your replacement i5 board. I also reapplied thermal paste in this step, but it is a bit harder to hold board and heatsink and to get the screws right. I would recommend getting another person to hold the parts together, it is much easier this way.
7) reassemble in reverse order, paying attention to all the small cables
Some things I noted:
- The i5 board has an additional port named "SKIN TEMP" (Apple part 922-9287) which goes around the hard disk fan (along with the ground wire), then under the PSU and up to the case near the camera, where the sensor is fixed with a little black pad. I did install it from the second machine, but I do not see it in any temperature monitoring tool and I honestly don't know if it is required at all.
- With the C2D board, the maximum fan speed for the CPU fan was about 4500, now with the new board and the same fan it is only about 2000. The other fans did not change.
- CPU temperatures are around 45 to 50 degree Celsius when idle and up to 75 to 80 under load with CPU fan at full speed. It does feel very hot to the touch, but I did not check before taking it apart, so that may be subjective.
- As others already noted, 32 GB of memory are possible in contrast to the 16 GB maximum of the C2D.
- The board contains the serial number of the machine, but I guess up to this point all AppleCare contracts have already run out, so this does not matter anymore.
So if you can get hold of a board or spare parts iMac with the board for cheap and if you like taking apart things, I would definitely recommend doing it. The upgrade takes a bit of time, but is not that difficult if you are careful to not rip out any cables. And with a i5 or i7 quad core, 32 GB RAM, one or two SSDs and maybe even a newer graphics card from the 2011 models it is possible to prolong the life of this very nice machine for a few more years, depending on your needs.