Yes, a HD6950 is certainly overkill for gaming at 1280x1024, if your set on a HD6950 save some money and go for a 1GB model.
Alternatively a HD6870 wouldn't have any trouble at that resolution either and would save you a fair bit of money.
Just to put it in perspective one of my HD6970's can max out BF3 @ 1920 x 1080 with 30-45FPS most of the time, BF3 is one of the most demanding games ever and 1920 x 1080 is almost double the number of pixels compared to 1280 x 1024.
No one knows what the future brings, we may not see another game as demanding as BF3 for along time.