Your CPU is not currently the bottleneck, it is indeed your GPU. What is your current budget? Take a look at the Radeon 5870, 5850, 5830and 5770. The 5870 might create a CPU bottleneck, but other than that I think it should be fine.
I would suggest you start considering a new build though. The LGA775 socket (the one that Core 2 CPUs use) is a dead socket. You're also certainly using older RAM (DDR2). You're likely to get a year or two more out of the build with a new GPU, but a new build is definitely in the near future for you...
I don't know your budget but you may want to consider a 5870 and upgrade the rest of your rig when you can. That'll give you something solid and lasting. Another great alternative is to get a 5850 and when you build the rest of your computer get a second one. That will give you power equivalent to a 5970 which will last you for a long time.
It's because ATI is currently destroying nVidia in performance, price and future proofing in pretty much every price range. If you're buying a GPU under $300, there isn't a single nVidia card I could recommend.