For what it's worth, (and seeing as you only really need to use Photoshop), a dedicated GPU wouldn't make much difference - It'd be your processor and your RAM holding you back. Your system is old and very outdated. DDR1 Ram and a Pentium 4 HT are so fxcking horrible I can't believe you would want to say with them. I'd suggest get an i3 or an i5 as they have Intel HD graphics perfectly adequate for photoshop - you could always add a better dedicated GPU somewhere down the line for gaming or Video production etc.
An i3 3220 or 3240, or an i5 3470 or 3570K would be best. True enthusiasts would get an i7 but you most likely won't see too much difference considering you could buy an i3/i5 and get an SSD / GPU instead of just an i7.
8gb DDR3 1600mhz RAM would be best.
Also you wouldn't need a PSU upgrade unless you got an extra GPU.
Let me know if you need me to find any prices/products or whatever.