you need to go quad.
and you wont be playing on HIGH for 400 bones
but a used C2Q and a 6870 will do well for you
so will 8gb of ram
but SB core i5/8gb ddr3/6870/h61mobo might be able to fit the budget
1x SAPPHIRE 100314-3L Radeon HD 6870 1GB 256-bit GDDR5 PCI Express 2.1 x16 HDCP Ready CrossFireX Support Video Card
Item #: N82E16814102948
$10.00 Mail-in Rebate Card
$169.99
1xG.SKILL Ripjaws X Series 8GB (2 x 4GB) 240-Pin DDR3 SDRAM DDR3 1333 (PC3 10666) Desktop Memory Model F3-10666CL9D-8GBXL
Item #: N82E16820231426
$41.99
1xASRock H61M-VS LGA 1155 Intel H61 Micro ATX Intel Motherboard
Item #: N82E16813157241
$49.99
1xIntel Core i5-2300 Sandy Bridge 2.8GHz (3.1GHz Turbo Boost) LGA 1155 95W Quad-Core Desktop Processor Intel HD Graphics 2000 ...
Item #: N82E16819115076
$179.99
Subtotal: $441.96
if you can swing a bit more fo ra 2500K its a better deal
recoup some expenses by reselling your old shit
but really its like 1-150 for a decent C2Q and DDR2 is expensive, you will pay 40 or so for 4gb of it, and you need a GPU anyways.
small price increase for the h61 and newer CPU but huge overall upgrade.
if he could sneak in a z68 board that advertises 22nkm support he has an even bigger upgrade path