For say about 160 on the egg, I think the 5770 is almost at the level of the 260. Plus has dx11 support. But you may want to google and check some reviews. But that pricing is pretty good to pass up. Give it a month though and prices may drop. Plus as time goes on, drivers should mature and performance should increase a little more.
Unless you're truly suffering gaming wise, I'd hang on a couple months. The GTX 260 is a nice upgrade from the 8800GTS 512. That's what I did originally. But, with the 58xx series just released, and nVidia scrambling to release their 300 series, it's a very good time to sit back and watch.
The 58xx series seems to perform really well (5770 is okay I guess, but nothing outstanding from what I've seen). Once nVidia releases something, everyone's prices may come down a little due to competition.
However, you might start seeing price reductions on last generation cards just to get rid of them. For example, NewEgg did a $15 off 1 day coupon code for the MSI GTX 260 card earlier this week.
ATI did price the 5770 well though, as a good mainstream GPU. Comparable to GTX 260 performance I think, and has DX11 (which will happen in the future).
I'm in sync w/ jereece above ...... expecting an nVidia release between Thanksgiving and XMas for the 1st series of cards. More importantly, if you are not suffering, there's no reason to get anything new at the moment. Personally, I don't like to buy "Rev. A hardware" and prefer to let technology mature. The individual manufacturers haven't even started tweaking the 5xx series and the big magilla 5870x2 hasn't been released as yet. If ya can wait, I'd sit until after XMas when:
a) You can see how nVidia shakes out against the 5xxx series.
b) The manufacturer's will have stomped all the buglets and be on to Rev C hardware
c) Drivers will have matured
d) The faster, tweaked versionswill be out
e) Prices will have started to fall in the post Xmas doldrums
The difference between the 5770 and 4870 is that the 5770 consumes less energy, makes less noise, has DX11 and Eyefinity support.
So basically all the goodies of the next generation in a low heat/low energy friendly form factor.
You can get deals on the 4870 for less but you miss out on next gen features.
Dirt 2, Alien vs Predator, etc. will all feature DX11 eye candy.
Wait if you must, but if there's any game not playing at optimal right now, then now is the time to upgrade, because Fermi may come anytime in the next 4 weeks to 4 months, but it's unlikely to be cheap in any way. So since you're condifering a GTX260 even at this late stage of the game obviously you have money concerns, so an HD5770 gives you improved performance far more future-looking features, and all that game play you get to enjoy while others are waiting.. still waiting.... and then... waiting.
If there were anything more than a 50% chance you'd possibly A) See any card for sale from nVidia before Xmas, B) Afford any iteration of said card, then I'd recommend waiting, but as I don't see either happening anytime soon, I'd say find a good price on whatever tickles your fancy now (read some reviews for performance and features) and then buy it and enjoy it.