Settings should be put as high as performance allows first. After that, AA should be put up. At 19xx res, anything past 4xAA is pointless unless your monitor is over 30". (Game dependent, but generally true.) On a 42" t.v. (with my face practically on the screen) the AA difference stopped being noticeable at 6x generally, while others did need 8x. While sitting back on the couch or even leaning back on the desk, 6xAA was almost overkill. The pixels are so small that smoothing them out really doesn't have that much effect on visuals beyond a certain point.
On my 23" I cap it at 2xAA generally since the screen is smaller and my 5770 can only handle so much AA with max settings before I start seeing frame rates dropping in high demanding games. I do notice a big difference with AA on and off, but there is diminished returns with it. Also, AF is noticeable and seems to scale a little better at higher levels. With a GTX480, crank them as high as performance allows...which should be pretty dang high, if not max, on almost any game.