Please help me figure out what kind of system I need

We need a new computer but there are honestly so many choices that I'm having a hard time figuring out what will work for our needs without paying for more than we do need. We do some basic gaming and video editing. Also my husband wants to use a design program with the following recommendations (it won't run at all on our current computer, and photoshop keeps crashing as well):

2+ GHz processor
2+Ghz RAM
500 MB free hard drive space
3D class video card with 512+ MB memory. Must support OpenGL version 1.5 or higher. ATI Radeon and Intel cards are Not recommended.

I was initially looking at an i7-860 with a GTS 240 graphics card, but that may be way more than we actually need. My husband would prefer to keep costs in the $500 and under range, if possible. I know we can't do that with the above system. He vetoed my suggestion of building it ourselves, but refurb is ok. I also prefer to have a system that has a little room to grow and isn't just barely getting by because getting a new system is like pulling teeth. Our current one is 7 years old.

So what should I be looking for with respect to a processor and graphics card and/or a system as a whole?

Thanks