Do you actually know how big that case is? That review is ancient, and the new GPUs are massive. I'm going to go ahead and suggest that you include both a new case and PSU. Rosewill isn't a high quality unit, and there are good ones that are pretty cheap.
This is more than powerful enough for your resolution. That said, if you wanted to upgrade to a 1080p monitor soon, you increase the budget by $100 and get the HD 5870 and an HAF 922 (the 690 might be a tad small for the card). This would allow you to play every game at max settings at 1920x1080. The 5850 would be fine with the exception of a few current games.