I wouldn't bother upgrading the video card at least until this summer. Waste of money since prices will inevitably drop once ATI (AMD) enters the DX10 game. And anyway, your card right now is pretty damn good.
Yeah your system should be able to hang on just fine . I would say wait for the games to released , see how they play.
If gameplay = crap then dump system in a dustbin and make a new rig. (also come back here and shout at the people who said it was good
If gameplay=satisfactory then enjoy 8) preferably with a glass of beer
(that is if you are above the age limit and can drink responsibly)