As far as I'm aware there is a significant difference in performance. The rest of your system isn't by any means too sluggish, so a new graphics card would give you another year or two's worth of reasonable performance.
I'd go with the upgrade then look at a new system in the reasonably near future, while you can still get a little cash back from your investment in a new graphics card for your current machine.
But, if you can afford it, I would go for a new system. You don't need to spend that much to get significant performance over your current system. Have a look around, see what you could get back if you sold your current machine and see if it would be faesable to fund a new machine.
Your current one isn't bad, just going with new technology in the form of PCI-E, SATA(II?) and so forth will stand you in better stead in a year or twos time.
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