OP - you're working in a Dell, which is totally different from anything most of us have built with. The video card is oriented in a reverse fashion, and indeed, you need a single-slot bracket, even though you can use a double-wide heatsink. Very odd configuration. The IDE cable will not be in the way, since the heatsink is pointing
up, not down. All that being said, I think you should avoid doing any upgrades on the CPU cooler. The CPU is oriented completely differently from any standard board, and an aftermarket CPU cooler may not fit.
I think you should go ahead with the HD5770 that you identified as having a single-slot mounting bracket and double-wide cooler. It's a relatively unique configuration, so you won't have many choices.
And to those who say it's not much of an upgrade, the 512MB ram on your HD4850 will be a major bottleneck in many games, so that alone is probably worth it, in addition to the 36% increase in clock speed. Here's an example of what happens when you hit the memory bottleneck:
http://www.anandtech.com/show/2856/6
The truth is you're
very limited in what you can do with this computer. Dell does not design systems to be easily upgraded. If you want to spend the money on the card, you'll get a nice increase in performance, but nothing extraordinary.
Your other option is to wait on the single-slot Powercolor HD6850, which may come out in the next month or so.