Is it? My last dual socket rig was lga 771 and don't think they were interconnected. Of course, that was millennia ago.
771 like 775 still had the memory controller on the motherboard. There were server boards with quad channel off of the MCH and was shared between CPUs because both CPUs were connected to the MCH. That changed with 1366 when the memory controller was moved to the CPU however, the PCI-E lanes were still shared. QPI enables CPUs access each other's memory however, there is a latency hit for every request that needs to go over QPI. It's not that the CPUs can't access another CPU's memory, it's just that it takes more time to do it compared to the memory pool that exists locally. So theoretically you could have a process that utilizes both CPUs, the question is more about what kind of performance costs will be had by having to access each other's memory.
In all candor, it's only CPU to CPU, we're not talking 4p setups, where the CPU can only talk to its closest neighbor so some might have to jump across a CPU to get to where it's going. It's not going to be optimal for gaming however, with a machine like that, you probably could get 3 GPUs and be able to run 3 VMs with 3 different people playing games on a machine like that. Will it be as good as a modern machine? No but, being a relatively modern 2P Xeon, it's capable of a lot of parallel computations, which is what those CPUs are intended for.
Personally, I would be less concerned about the size of memory and more concerned about the clock speed. These are sandy Xeons, so lower clocks will hurt you more than the same clock with modern hardware. To me, the only benefit here is that the OP could be crunching, encode video, do some other computationally expensive task, and play a game at the same time but, for gaming, I bet that this setup would be comparable to a i5 2400 at best given the max turbo speeds and possible memory latencies due to being a 2P system.
So all in all, it all depends on what
@Knoxx29 is planning on doing with this machine.
tl;dr: 2P systems (particularly older ones,) aren't going to be ideal for gaming in general. 16GB is fine, I would be more worried about the performance of the CPUs given the low base clock and only half-decent boost clocks on an older architecture. Don't expect performance to be better than an i5 2400 when it comes to most games.