not 100% sure, but it sounds right.
sounds similar to how mine is set up, CPU cooler and case fans. (except on mine, the front intake fan is just a bay or so lower from the CPU cooler and exhaust fan, so its more or less a straight shot through the case from front through one of the HDD cages to the RAM/CPU and then out the rear. also have a 92mm top exhaust, PSU exhaust and a 92mm rear fan behind the rear HDD cage.)
I just got my i7 920 system fully up and running tonight too, and it idles around 37-40C with the same cooler you have & IC Diamond Thermal paste.
Running the MSI X58 Platinum board (crossfire only
), 3GB DDR3-1333, one Radeon 4870 for now (Win7 is giving me fits when I insert the 2nd card)...
Corsair TX-750 750W PSU, Thermaltake Armor Full Tower case (had to resort to using the stock side panel since the optional 250mm fan side panel won't close due to the CPU cooler being just a bit too tall).
running 5 SATAII Drives, 250GB 32MB Cache Seagate, 2x 250GB 16MB Cache WD Caviars in RAID 0, 500GB 16MB Cache WD Caviar, and a 80GB 8MB cache 7200RPM Fujitsu 2.5" drive. plus 1 SATA DVD Burner and 1 PATA DVD Burner. and a Rosewill 3.5" bay Flash media reader.
right now while running Folding@Home GPU console Client the system is sitting at 42C.