Even with Win7 the system will be a lot better.
My system I have now cost me £435 with Win7.
The extra £35 could get you a better processor and a HD 6870.
EDIT : Ill pick out the components for you.
EDIT 2 : You could with a Phenom II 955, its a little cheaper than the i3 and more games, like BF3, are starting to fully utilize more cores.