you're definitely going to need another 1GB of RAM, but it's cheap.
as for the card, if you can swing the $250-$275, I'd go with the 8800GT.
on my E6850 @ 3GHz and my 8800GTS 320 (which is slightly slower than the new 8800GT, sadly), I was getting 15FPS at 1680x1050 and all settings on...