While the UT3 engine is pretty, you suddenly get rid of a large amount of PC gamers by upping the system requirements. Source can be played on a large range of PCs. I'm basing this all on UT3 itself. Has the engine been made more scalable lately?
If you're avid about playing PC games at all, you should have a decent enough computer to run an Unreal Engine based game pretty well. Hell, you can get such a PC (outdated hardware) for $400 or less these days. Essentially, if running HL2 is as far as your PC can go, you need to bite the bullet and upgrade.