Well the basic process is to figure out what you would like to spend on your system for a new card. Two years is pretty old for a game system, And you don’t want to go investing money that will be wasted if you do get a new system, but ultimately if you are good with it for what you need it for, then figure an appropriate ammount for you.
Here is a chart from Tom’s hardware, which is very respectable in my opinion. There are never are totally objective ways of comparing which card is better in all situations, but Tom’s 3D benchmarks are a damn good baseline.
http://www.tomshardware.com/charts/gaming-graphics-charts-q3-2008/3DMark06-v1.1.0-3DMark-Score,794.html
This is from late 2008, and as you can see your card is pretty much the bottom for that time, and as you know is nearly obsolete now. That chart gives you a decent Idea of how much better some of the options you have are.
And here is the list of pci-E x16 cards from new-egg.com. One thing you should decide is if you need directX 10. If the particular game you are talking about has a minium of x1600PRO, then it almost positively doesn’t require Directx10. But it may not be a bad thing if you are thinking you may use it for other stuff for a few months.
This for example looks pretty good, a much better performer than your current one and a good rebate to make it cheep, but there are a few caveats.
First is space. Dell are kind of notorious for customizing cases for what ever they had decided on previously. You should look at your current card, measure it, and check that the dimensions in the spec of any new one will fit in the allowed space. And be realistic. If it looks like a total cram job on the bottom that is no good. It will need some decent space off the fan to blow air to cool, better cards make more heat, and you need to allow for cooling.
Second caveat is power. Better cards draw more power. That card says you need a power supply of minimum 350 watts. If you can look through everything you have about your computer to see if it does have a 350 watt power supply. Now I would be really surprised if your Power supply is too small. 350 has been one of the smallest you can get for years, and dell does over build on that part, but I would suggest doing what you can to find out for sure on yours. You should also take a look at your card to see how it hooks up to the power. If it already hooks up by a 6 pin(maybe .5 inch by .66 inch plug with a 3X2 arrangement), then that would work no problem. but if your power supply doesn’t have a six pin, then you need to make sure you have 2 4 pin power plugs(normal translucent white 1.25 by .25 )open for power.
You don’t have to fall in love with that card, if it seems like it wont work. There are many cards on that page better than yours, with fewer requirements, but it looks like a good place to start for me.
Hope this helps, and others can give some input if I missed anything.