I know that the read speed will then be limited by the HDD but will there be a further dramatic decrease in speed due to going through the SSD first?
That makes no sense at all. Either your game is loading from the SSD or it's loading from the hard drive. Nothing passes thru the SSD first. If it loads from the SSD, load times will be faster. Remember, this doesn't make games play better or all programs run better. It just decreases load times.
60gig is also kind of small, especially for win 7. I can easily fill 60 gig with just the OS and a few games.