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Help on New Rig

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Hello everyone I need advice on what CPU/ GPU to buy for my computer My budget is $500 give or take $20
My planned Rig so far:
Case: Antec Three Hundred Two
CD/DVD: Samsung DVD Burner
Motherboard: Gigabyte Z77X UD3-H (Or if 2500k some z68 mobo not sure which one)
CPU: 3570k/2500k not sure which
GPU: GTX 460 768 mb (Better one if going with 2500k)
PSU: OCZ ZS 550W
HDD: 500 GB Seagate Barracuda 7200 RPM
Ram: PNY 4GB (2x2GB) 1600MHZ
So basically my question is if I should go with a 2500k which is $160 and invest in a better GPU than the GTX 460 which is $96 or go with a 3570k which is $190 if I go with a 2500k what graphics card would you recommend?
I own a 1024x768 (I know pathetic) monitor but plan on buying a 1600x900 monitor soon. I also plan to overclock to speeds around 4.0 Ghz so would a stock cooler be sufficient for that? I am going to be using this rig for mostly gaming and a little video editing. Thanks for your help guys :) 

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Lol this is overkill for 1600x900 resolution? Hmmm was not aware of that and nothing against AMD just I think I'll stick intel but thanks for the suggestion any one else have another suggestion? The reason I'm going for 1600x900 is that my friend is selling me one for $50, also a budget system isn't likely to run 1920x1080 as well as 1600x900.
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Really? I already own the psu and hdd so the price including tax and shipping for me is 497 so thats even better for me I thought a gtx 460 was a weak card though and not suited for 1920 x 1080.And this is the 768mb edition not 1 gb so should i stick with this because this is a budget price. The deals at microcenter
Are crazy good so the price comes out $497 which is within my budget

Honestly the video card is the only "weak" point of your setup. But its still a nice card. I would probably go for a 7770 or something, spend the extra cash, but yea, its going to play 95% of all games at full settings. And the other 5% you might have to turn one or two things down 1 notch.

OK so the video card is a little more powerful than I expected and a 7770 isnt as powerful as a gtx 460 plus it is more expensive so I think I will stick gtx 460. Also how would this system run minecraft L4D2 and COD with fraps at ultra at 1080p I might play battlefield and skyrim as well. Thanks for your help :) 
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