I vote for doing it. I've done the westmere mod on my E762 and it works perfectly with a X5650 & X5670.
Just FYI, the only difference between the X5650-X5690 is the multiplier, TDP and all that stuff doesn't matter at all, so get the X5650 instead since it's the cheapest.
As for oc'ing with 12GB+ of ram, it depends on what IC's your ram has, your motherboard and what the IMC can do, I've run my 24GB's (6x4GB) @ 2100MHz 9-10-10-27 1T 1.6v without problems. Albeit the ram I have is known to do 2600MHz+.
Also, the X5690 is not equivalent to the 990X they have completely different architectures. On the other hand the W3690 is the direct Xeon equivalent of the 990X except it has an ECC memory controller, it also shares the unlocked multiplier (on most motherboards).