Even if you did game at low resolutions, and even if your cpu did start to bottleneck the gpu, it would not matter because you'd be getting such high framerates. Remember, as long as you can game at smooth framerates, you're fine.
ex: let's say you game at something equal to or less than 1440x900, and you're getting 100fps. if you got a faster cpu, you could get 125fps. Again, does not matter because 100fps is way faster than your monitor anyway. Even if you did have a 120mhz monitor, you wouldn't be able to tell the difference between 100 and 125fps.
There are two limitations. One, at that resolution, yes your cpu will often be the limiting factor to your fps with a GTX260. But, the limit will still be at a high fps, still very smooth and playable. The second type, would happen at times within certain CPU limited games. Take Oblivion, inside the Town gates is very CPU limited, enough so that at max details you could find areas well under 30 fps with that CPU. The GPU isn't being stressed much in this area and may be capable of 70+ fps. The large numbers of NPC's for instance, hurts the CPU bad. Other parts of Oblivion hammer the GPU. Another place the CPU would come into play would be while handling high physics in crysis; you'll have low drops in fps at times because of the CPU. Anyway, overall that is still a very capable gaming CPU that will not drastically hurt your performance. So I'd say go for the GTX 260, except, it will be a rare game that you need a GTX260 for 1280x1024 gaming. For most games, you could save money and just buy a 9800GTX or HD4850.
This thing about resolution helping to cause bottlenecks with a CPU is a fact. I spent quite a while proving how it works on this forum in the past. This is much less likely to happen with a modern CPU, the older single core processors when teamed with a faster modern GPU will suffer from it more. The CPU can only calculate physics so fast. Now if the card is running at say 1680 x 1050 and is working a bit to do so then lowering the res means it has less to do so it will run faster. The assumption is that the CPU is close to flat out keeping up in the first place, so if the card is asking for frames faster than the CPU can do the calculations then you get a restriction on the FPS because the GPU is waiting for the CPU. That's not exactly what is happening technically but that's the basic idea. I really don't see why people have a problem understanding it.
both cards will be a over kill.....but i believe u need to upgrade ur psu first, specially if its not of a good brand......
and as for which card.......u should get which ever u get cheaper.....they both have same performance although i must say that 4870 has a better cooler (it takes the heat outside of ur casing and dump it)
As you are specifically asking what card to get at your resolution the answer is neither. At the resolution you are using you wont get to the bottom of a 4850 nevermind a 4870. Your PSU should be ok with a 4850 as long as its not a really cheap one, the card will be a bit cheaper and the CPU bottleneck that i dont think would have been there with the 4870 will be even less likley. If you must get one of your chosen cards then the 4870 will see you further than the 260, but you will need a decent new PSU.
i'll buy a new screen later and up the res. , ive read contradicting reviews about the 4870 and the gtx 260 (which would last longer for future titles) and honestly i wont feel like am upgrading (although i know there would be a huge difference), since before the 8800 GT i had a 7900 GTO 512 Mb also , i need to change the number