Now when i see the Sharepoint Server 2010 requirements, it has a unpractical requirement of 80 GB free on system drive, 4 gb of RAM and 2.5 GHz per core.
Sharepoint isn't a toy, it's for the enterprise. The requirements aren't impractical - if you are running a Sharepoint instance foro your business you want to application to perform appropriately. Microsoft sets this minimum system requirements so their PSS don't get flooded with "My Celeron server has 20 users on Sharepoint and it runs slowly" calls.
I have dual core processor of Intel 2.2 Ghz, 15 GB free on system drive and 3 GB of RAM. Will Sharepoint Server 2010 install on my machine? Or do i need to again format my PC?
Sharepoint Server 2010 should install and work fine on your computer. If you are the only user then Sharepoint will run appropriately for you within the resources you give it.
The only issue I have is the operating system. This blog posts says preliminarily that:
... will be 64-bit only.
... will require 64-bit Windows Server 2008 or 64-bit Windows Server 2008 R2.
... will require 64-bit SQL Server 2008 or 64-bit SQL Server 2005.
And according to this Windows 7 is "optional" for the
Single server with built-in database and front-end Web servers and application servers in a farm configuration.