Most important vinyl component to upgrade first ?

The most critical unit in analog reproduction is the Phono Stage. There is absolutely no way to degrade a signal more than here [Only exception: Using MM Cartridge, then it is not necessary to think about a high quality Phonostage].
Your 1-5 list is correct.

The cartrideg I find makes a really big difference. That said a crappy phono stage will ruin anything the cartridge is sending it.

IMO the comment by TPReaves pretty much says it all, although Viridian also makes an excellent point in emphasizing the importance of a synergistic match between cartridge and tonearm.

I would add that more than a few very experienced audiophiles here, whose opinions IMO command a good deal of respect, have expressed the belief that a relatively inexpensive but suitably matched cartridge mounted on a high quality turntable/tonearm combination will generally outperform an expensive cartridge mounted on a relatively inexpensive turntable/tonearm combination. I see no reason to doubt that, as a general guideline.

02-02-13: Syntax
Your 1-5 list is correct.

Surely you didn't mean to suggest that the choice of cable is more important than the choice of turntable, tonearm, and cartridge, at least in situations where the length of the cable is not unusually long. Or did you?

Regards,
-- Al

Al,
good point. I thought about it when I read the list. From my experience the majority of Arms (inside) is far away from its possibilities based on their cheap, average cable inside. For example, a cheap Rega Arm can show very good results when it will be rewired, you can simply get the most out of it with such a modification. When all is done to get the best out of any Arm, then it makes sense to go ahead (not everyone can afford everything but when you have something which can really deliver what is possible from its design, it can be absolutely fine). Various SME Arms are another example for internal wiring.
Some Arms have good wire inside (Graham for example), here it makes sense to link a top cable from its connector to the Phono input.
Or another example, when you work with Headshells, most are delivered with very cheap leads. When you replace those with top leads, silver or copper, you hear immediately the difference, for a small investment about 35-60$. The cartridge signal is so fragile, you can't improve it, but a lot can be done to degrade it.