I think you invested too much money into your cpu when you should have spent it elsewhere. You'll need at least a GTX470 to make that i7 worth the money you payed. I'd start there with your current price range. Also check the Radeon 5800 series I think, not my area however.
Also, your power supply might border your limit after upgrading the GPU, honestly it's whatever you feel like your money's worth, but 750watts isn't that expensive.