2.9ghz (300mhz Overclock) is pretty good with software, but I think it could go a little higher.
I think your a little confused on how overclocking works, as far as voltage goes. CPU Voltage and FSB are two different things. Increasing your FSB speed does not increase CPU Voltage, and Increasing CPU Voltage does not increase FSB.
They are completely independent from one another.
The only time you should ever increase the CPU Voltage is to gain stability, provided you have the cooling to support it.
For example: Your using stock Vcore (in your case 1.344v) and you can run Prime95 stable for hours at 150 FSB. There would be absolutely no reason at all to increase CPU Voltage.
If for example, you can not run Prime95 without failing or crashing, you might want to bump the CPU Voltage. When you raise CPU Voltage (or Vcore) only raise it in the smallest amount possible and re-test.
When you raise Vcore you also raise the CPU Temperature. In your case with the P4 506, your MAXIMUM temp should no exceed 67.7C or 153.86 F
If your temperatures are getting close to the max, you need better cooling before you can continue overclocking or increasing Vcore.
Hope this help.