Need advice for video card for 37" LCD TV

[OnyxINC]

I just built a new computer using a Core 2 Duo E6550, ECS G33T-M2 Motherboard, 2GB DDR2, VisionTek Radeon X1300, Sceptre "37 1080P LCD TV. Quake 4 Tells me I need Open Gl Drivers when I load the game, and the BioShock Demo was unplayable. I added the VisonTek card so the onboard video wouldn't eat up my system memory. (Is the onboard video better than the video card?) What would be a good buy, that would support games at med to high quality. From what I've read, my top choice (Under $400) would be the 8800GTX 640MB GDDR3 and the bottom end would be a X1950Pro or XT. Should I wait for Nvidia or ATI to release a new series of cards? After reading reviews, the 8500/8600/X1650/HD2600 don't seem to be up to par with todays technology. I really don't want to pay over $300 if I can avoid it.