Refresh rate is important if you notice blur in fast moving images, it depends on the viewer's eyes, i really can't see blur below 8ms pixel response but have found that in games i can notice input lag and it really bugs me in fast action, so i buy less input lag and don't care too much about refresh rate anymore. I'd be going for a 27 incher with 1920x1080 res. Less video card requirements, cheaper, and sharper image with 1080p consoles, let alone the ability to see from a further distance which is always good for the eyes. For the amount you want to pay i'd even consider an entry level IPS panel they'll set you back ~300 though. Check Dell s2740l or AOC i2757fm for cheap good IPS panels, the regular ones cost over 600.
If you truly notice motion blur you should check Samsung SM2233RZ, a 22inch 120hz TN panel panel but tested as the fastest in the market.
BenQ XL2420T is also good but not quite fast as the SM2233RZ; http://www.tftcentral.co.uk/reviews/benq_xl2420t.htm