The Radeon 9800-XT will work well on your computer.
As for Geforce v.s. Radeon (nVidia v.s. ATI) there are many oppinions on this, but generally people seem to think that the Radeon chips are better, but the Geforce has better drivers.
imho the 9800-XT kicks *** though
You have a good system. It will perform well, and not too pricy (well except for that killer video card