The Celeron/PII core is pretty much maxed out at 550-600MHz. That's just the limitation of the silicon, and to get higher than 600MHz or so needs a prime CPU, powerful cooling (probably a TEC) and luck.
Bearing that in mind, I think it's better to take a slower C366 chip and push it to 550-600MHz than to take a 533 and push it to the same speed. Your FSB will be higher with the former which will result in better overall performance, because the memory and PCI devices will be faster.
I have a set of golden globes
You'd like to thank the Academy, right?
my paste is not so hot
Arctic Silver is the best you can get. Beware the OCZ silver paste, it's been reported that it doesn't actually contain any silver (they withdrew it, but there might be some people still trying to sell it). However, don't expect temperature drops of more than 2-3 degrees using it. If you carefully lap your CPU slugs and heatsinks and then put the paste on, though, you should pull 5-6 degrees off your temps. Might be good for another few MHz.