26 inch monitors are a little tougher to come by, it's kind of an odd size.
This is a nice 24 inch model http://www.newegg.com/Product/Product.aspx?Item=N82E16824236153&Tpk=asus%20vs248h-p
And a 27 inchhttp://www.newegg.com/Product/Product.aspx?Item=N82E16824236101
Not knowing your price range I went for the more inexpensive end which emphasizes response time over color accuracy. Also you said you were using a USB connection but I'm assuming you will want HDMI, which both of these monitors support (though neither have speakers onboard).
At the 27 inch size you will not notice a big difference between 720 and 1080, however most modern monitors (even inexpensive ones) support 1080 so theres really no reason not to go that route.
And finally that graphics card is fine for video, and can probably run most games and medium to high settings depending on the game and your settings.