Here are a few options that should play Minecraft better than what you have now:
http://www.amazon.com/ThinkPad-E545-20B20011US-A6-5350M-Computer/dp/B00HJB9UWC/ref=sr_1_1?s=pc&ie=UTF8&qid=1405742716&sr=1-1&keywords=laptop...
Laptop/Tablet combinations are always going to be "underpowered" compared to conventional workstations, as they are designed to be light and portable with the option of sitting down at a desk and doing some actual work. If this is important to you, I would suggest a conventional laptop, unless...
This Dell tablet has very good reviews: http://www.amazon.com/Dell-Venue-16-Tablet-Android/dp/B00FFVYSKW/ref=psdc3_t1_B00FFVYSE8_B00FFVYSKW
It also contains double the memory as opposed to other tablets I saw in the same price range (16GB vs. 8GB) and double the Ram as well (2GB vs 1GB).
This one seems to have good reviews, very standard little tablet. Used "Like new" for $75.
http://www.amazon.com/Acer-Iconia-B1-710-L401-7-0-inch-Tablet/dp/B00DKFF386/ref=sr_1_5?s=pc&ie=UTF8&qid=1404006194&sr=1-5&keywords=tablets%5D
You're not gonna get much more for that budget I'm afraid.
In short, yes, that's what the Windows disk is for. Your product key should reactive Windows no problem as well. Although DBAN isn't really necessary, you can wipe the HDD right from the Windows installer and do a fresh install.
It all depends on what it has for a graphics processor. San Andreas is not a benchmark for GTA V at all.
I also realized while I was typing this that GTA V isn't even out on the PC yet...