Did you already buy this computer? I wasn't quite sure, but it sounds like it. Generally, I'd recommend asking the "is this good enough" questions before
Your just asking to be disappointed.
The CPU should be fine. I have it and run the latest games in high settings. It would be nice to know what motherboard you have in there because that can make quite a difference.
I recently went from a Radeon 9800 Pro to the Nvidia 6600GT and my 3DMark03 score went up 29% and 3DMark05 score went up 32%. That was more than I was expecting. The 9800 Pro was only a year or year and a half old and <GRIPEMODE=ON> I paid like $350 for it.</GRIPEMODE> The 6600 GT was $220. I'm believe that the 9800 Pro outruns the FX 5500 by nearly a factor of 2 (based on the FX 5600 numbers), so imagine what a 6600 GT would do for you. If you look at this Leadtek 6600 GT
from NewEgg, you could have it in a few days for $189 shipped. I've owned a couple Leadtek video cards and they were extremely well built and engineered. BFG (the makers of the card you have) also make a 6600 GT OC version with a very good reputation, but they do cost more.
I would also consider adding another 512 MB of RAM to get to 1GB of PC2700 as opposed to replacing it with 512MB PC3200 (assuming the motherboard supports PC3200). You'd see some increase, but probably not justifiable to the cost. Some of the newer games will make good use of a GB.
Oh, and that FX 5500 .. one word, "eBay."