Upgrading HP H8-1237c suggestions

The following assumes you want a gaming system. If you want something else (video edit for example) say so.

Net: All you need is good video.

i56-2320 -- Great processor, no need to upgrade for a long time. 95W max tdp.
10 GB mem -- 4 is minimum, 10 is plenty. no need to upgrade.
nvidia gt 520 (or even worse integrated graphics) -- REALLY WEAK for gaming. This needs upgrade.
sound - fine
wireless - fine
disk - 2TB 7200. fine. SSD for faster boot if you want it. Raid 0 for speed if you want it, raid 1 for data protection if you want it. But current disk is fine for gaming.
power supply -- 300W

Two major options.

1. Stick with the 300W PSU and get something like an 80W HD7770. That will be much better than the video you have and its an easy install. $135 shipped. http://www.newegg.com/Product/Product.aspx?Item=N82E16814127687
2. Upgrade the power supply to something stronger (its a standard ATX PSU) and install whatever card you choose including some monsters. A good PSU (e.g. antec VP-450) is less than $50. A great video card is $150 plus, no point in looking lower if you upgrade PSU. Here is an excellent ref: http://www.tomshardware.com/reviews/gaming-graphics-card-review,3107.html