That PSU is a little weak on the +12v lines (1x10A and 1x13A) but should still drive most cards within your budget wit no problems.
Best value: HD4850, they're on the 'Egg for under $100 US but lack the features of the new 5xxx series, they are capable of playing most games at your resolution at high/max settings smoothly.
Best choice: HD5750: A little faster than the HD4850 and draws less power, also has better HD sound if you're into movies and, of course, full DX11 support.
Fastest: HD5770, still under budget and faster than the HD5750, although more expensive, it will be slightly held back by the CPU, though, although this means you will be able to run at higher AA/AF settings without suffering too much of a performance hit.
If you are using XP then the HD4850 is the best choice, DX10/11 are not available under XP, they are Vista and Win7 only, so the extra expense of the HD5750/5770 will largely be wasted, unless you migrate to another OS.