Well, here are the results.
I was able to remove the pauses from Rage. Though my hardware was overclocked, but that was not what made it. I had to take the fan slider to 50 percent. At 40 percent, the game would freeze my computer with artifacts forcing a "reset". Still, the frame rate was not too good- it was just like Skyrim- but somehow the game was MUCH less playable than Skyrim. Skyrim is much smoother at the same frame rate.
In Skyrim, the difference between fully low, and insanely maxed out settings is just this: 10 frames!
On the highest settings, it runs at 12 minimum, onwards. And on the lowest settings, the game runs at 22 onwards. Somehow, changing settings are just not enough to increase frame rates, or the slight overclocking of both the CPU and GPU. They have made the game so that lessening of details would simply have no real effect in performance. But still, the game seems to be playable at the maxed out settings. There are hardly any jitters/stuttering even in fighting scenes with a few people around (except for the small time lag expected in that fps).
(The same way, when you have a recent card capable of burning through games, then even if you keep it 50% underclocked- which I always keep at least at the desktop- still the game works, and defaulting the card clocks would likely make hardly any difference.)
So yes, the hardware is old but pulling off somehow. But if you are not getting the same results with max settings, then you should understand that your card is third backwards from the first high end model (6770 > 6870 > 6950) and mine the high-end itself, may be that's why.
And yes, Madness Returns ran quite good on my system- well mostly. May be 2 or 3 times there was a situation when frame rate would take your attention, but never the card.
Someone said something about Crysis 2 being a DirectX9 game first. I'll like to tell them, that DirectX 11 has STILL not EQUALED DirectX 9c till date. Forget about it beating DX9. Matter of fact, some images seem to be much smoother/richer, and especially REALISTIC in DirectX9c than 11. So all DirectX 11 is doing it's taking away a lot of valuable card bandwidth. But if you wanted to say the same thing, then you are right. Slowly the DX11 would gain ground when developers start using it properly.
Well, okay. I'll probably play this game Skyrim now. But Rage, I'll play on the 7970. At least it'll save some electricity if nothing else at 28nm.
Thanks again everybody
P.S.: Of course I forgot to add, that in Skyrim, once inside a room/cave, I get even upto 85 fps- the refresh rate of my monitor- and most of this game is inside than outside!