At lower res, the 8800GTS 320 typically has a solid 20% or so advantage over the the HD3850 256. I doubt the extra 256MBs would impact performance much if at all at this res, especially looking at the negligible increase from the 320 version to the 640 with the GTS.
Another factor being filters; anti-aliasing has a more noticeable effect on smaller resolutions, so you'll be wanting to run 4x AA on any game you play, and the AMD cards are known for taking a bigger hit than the 8 series. The benchmarks back this up.
However, power consumption and price swing in the 3850's favor, so if it's significantly cheaper, I'd go that way.
The pink panther is probably right that the 8800GT 256MB will perform the best for you, but it probably can't justify the price jump, and don't think about upgrading that monitor anytime soon.http://www.anandtech.com/video/showdoc.aspx?i=3175&p=6