Which ATI 2600 are you refering to? There is a 2600pro and a 2600XT. Both of which are dedicated graphics cards. THE ATI 2600XT performs similarly to the Nvidia 8600GT.
The ATI 4200 is an integrated graphics solution that comes on the 785G motherboards.
The ATI4200 is probably one of the best integrated video solutions available, however the dedicated ATI 2600 would be the better choice. The 4200 might be better with DVD or BluRay playback, but that might be the extent of it.