Graphics card help...

When you say you updated the gfx driver, did you first uninstall the old one? You may want to uninstall again and run Driver Sweeper from safe mode to have it remove any remnants of old AMD and Nividia gfx drivers it finds. then install the correct driver again.
http://www.techspot.com/downloads/4266-driver-sweeper.html

Well before you buy anything I'd see how driver removal and re-install works, it could be that. Even if your CPU is bottle necking, you shouldn't be getting less fps than before, you should simply see no improvement. Also, you should check your GPU load and CPU load in games. Task manager in windows can check the CPU load for you, for GPU load there are many programs out there, like msi afterburner, some gadgets for windows 7, etc. My guess is one or two of the cores on that 4100 are maxed out, while the rest aren't doing much, especially on games that don't favor 4 cores.

Arma 2 I already know is going to have a problem with that CPU. The game doesn't run that great on anything, but that CPU probably just can't handle it.

If you decide to upgrade the CPU, you have a few options. First of all find out what revision of your motherboard you have like I showed in my previous post. If it is one that supports the 6300 and 8300 series you could get one of those. However, from a little research on that board, it's not going to support overclocking really since it's not that great of a board. So I would recommend either an 8320 or an 8350.

Another option if you want to spend a bit more is to get a new AMD motherboard and an 8320 along with an aftermarket cooler, and overclock it. This will be more, but will be better in the long run.

Finally, you could save up for an intel setup. This is the most expensive option probably, but will run the most games better in my opinion. I've had this same i5 in my machine for like 3 years now(2500k @ 4.4Ghz), and it's never been a problem.

It's a tough choice. If you can't buy an intel setup right now, but can't deal with the shoddy performance you get, I guess I would simply upgrade your cpu to an 8320 or 8350. Then start saving up for a whole new motherboard and CPU in a few years down the road, when DDR4 RAM and PCIe 4 are out.

But, before you buy anything, see if clutchc's suggestion does anything, then check your cpu and gpu load in games. From there, if you need to upgrade, like I said, see what motherboard revision you have, and we can go from there.

I sent you a request. I'd suggest editting your post and taking you skype name out, seeing as anyone could see that.

I can't wear a headset right now due to a health issue, but i can chat with you if you want.