That's a good choice; it's slightly slower than an 8800GT/9800GT, but then again, you can't find those for sale now.
For that price Nvidia only has the GT240, but that only has 96 shaders, instead of the 112 of the 9800GT, and the vendors don't sell them all at the same frequencies. Some sell it with a 550Mhz core, others with a 600Mhz core, others in between.
As far as performance goes, they might be more or less the same, epsecially those with a 600Mhz core, but the HD5670 has DX11 (not that it will take advantage of it much because it doesn't have the horsepower, but still, it's a newer card.)
As far as resolutions, prepare to be modest.
First, your CPU has a modest clockspeed to start with; it would be good if you considered overclocking it to something more palatable in the region of 3 Ghz. As even then, you have to factor in the absence of L3 cache, which the Phenoms do have, and yours doesn't, so the more overclock you can safely get out of it, the better to compensate.
Second, being the HD5670 a bit slower than an 8800GT, and the fact that I owned a factory overclocked one (from 600 to 700Mhz core, and from 15xx something shaders to 17xx something Mhz), I can tell you will be able to play some games at
- 1680x1050 with high details (but not many), but it's best to go for medium;
- 1280x800 or 1280x720 with Maximum Details (Left 4 Dead 2, for example, it will stutter at 1680x1050 in Maximum Details)
most games will play at the above resolution once you fine tune the details. Some may play on Very High, others on High, others on Medium.
- Heavy Duty games like Crysis/Crysis Warhead and Metro 2033 will only play at that resolution with Medium/High details. You will probably have to compromise on some things to get it smooth.
Oh, and make sure you have at least 3 or 4GB of ram. 2GB will hinder performance of the rest of your system in a lot of games. It's a good investment to make, especially as the ram prices have fallen in the recent weeks. It's a good time to buy RAM now, as the prices will go up again in the future.