Integrated graphics performance is improving, but it is no where near discreet video cards.
Intel's current Sandy Bridge Core i5-2500k and i7-2600k CPUs have the Intel HD 3000 graphics core. It is more powerful than previous Intel integrated graphics, but only a little more powerful than the Radeon HD 5450.
AMD's upcoming Llano CPUs (socket FM1) for laptops will have a more powerful graphics core; Radeon HD 6550D. It's performance is a bit better than the Radeon HD 6450. It's like this:
Radeon HD 5570 > Radeon HD 6550D > Intel HD 3000 > Radeon HD 5450
Compared to a nVidia card, it is about as powerful as the GT 220.
At least one manufacturer (Asrock) will be releasing a desktop motherboard which will use the Llano CPU.
Here's a preview of the Llano CPU:http://www.anandtech.com/show/4448/amd-llano-desktop-performance-preview