Now, with $400, I'll be able to (hopefully) purchase a 7950 when the 1.5 GB versions come out in March. I've also heard that the prices of the Sandy Bridge CPUs will be dropping, so I'm also hoping that I'd be able to get an i7 and a new mobo for about $400. I use my computer for gaming, listening to music and surfing the web. Alternatively, I may also go for an i5, and save up some more cash and get a different GFX card at a later date.
This would be an upgrade to the card that you now have if that is what you want to do. But it does seem that you want to upgrade to components that are not yet released so this post would be permature and you should post again when the parts that you want are released and you dan see what the prices are.
Well, yes, but if the proes here seem to think that getting the 2500K is my smartst move, then I'll do that perhaps earlier.
It's games like BF3 that show the need for a strong video card vs a better cpu. For example on your current computer you can easily play BF3 with a GTX 570 and your current cpu then keeping the video card you have and upgrading the cpu and I don't think that any of the pro's here can dispute that. There are other games that can benefit from a stronger cpu but those games will also benefit from a stronger gpu.