Ah ok, now should I get 512mb or 1GB which one and is there a notable difference between the two.
For the ATI 5770, you might as well get the 1GB. The 512mb cards out these days are usually old school cards, or designed to be "budget" minded options. The 1GB would definitely help with higher resolutions, or higher texture settings (higher detail settings).
In the <$200 price range, the ATI 5770 should work very well at your resolution. If you wanted the best possible performance for your money, the GTX 460 would be up at the top end of your budget. However, it's not necessary, and could potentially be limited by your CPU in some situations.
Unless you intend to do other upgrades, or play more intensive games (from a graphics standpoint) the ATI 5770 should be your best over all value.