Can you overclock the video card in a prebuilt like this? Would I need to upgrade the PSU in order to do so? I realize the power supply is lacking. I am planning on getting something around 700W soon.
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generally yes, you can, gpu functions are usually unlocked.
You sure you only have a 460w PSU? AMD recommends a 500w power supply for a system with an HD 7870 in it and OEMs usually go with those guidelines. That being said, Dell has really stepped up the quality of their power supplies and I'm sure what you have provides plenty of 12v amps ( more imporant than total watts ).
Yes you can overclock you graphics card. Either with the AMD driver or a 3rd party tool like MSI Afterburner.