It may, but having a PSU with Over Power Protection should minimize the risk. I have helped many friends and family members with fixing computers, and of all the blown Videocards, not a single one took any other components with it, including one 8500GT that had melted caps, just like yours. But, as I remember, they all had decent quality, if low power, PSUs.
I still haven't tested it under full load. It idles at 56C. I also forgot to add that sometimes I have artifacts upon logging on. After a few seconds windows restarts my display drivers though this happens rarely.
Your card is blown. Artifacts in 2d load is NOT a good sign in the slightest. I am willing to bet that it will not be able to do any 3D functions at all without crashing or devastating artifacts. If you open up the Nvidia control suite (can't remember it's actual name) there will be the green nvidia symbol in a small window that is 3d rendered. When I worked on the computer with the blown 8500GT, it would artifact on that little symbol horribley, and would even crash if left open for more than a minute or two.
I just opened nvidia control panel and no artifacts can be found on the nvidia symbol. I can try running GTA SA but I think it won't be stressing my GPU enough. Any suggestions on what I can use to stress my vid card thats free?