1) Yes, positive difference, but not worth upgrading from i7-960 to i7-2600K
2) No - The i7-960 will run games very well.
Suggestion: Try overclocking the i7-960. For reference, my i7-920 is overclocked from 2.66 GHz (stock) to 3.82 GHz. Running at this OC for over two years! No temp problems.