So let me get this straight.You plan to save & invest in a processor if they claim that Dual core is a must for GTA 4? And later on will have more money to invest in a graphic card which is let's say either a 9600GT or an 8800GT, right?
A.) Most of the current games are stipulating a good dual core processors for smooth gameplay.
B.) Let's assume even if GTA IV doesn't mandate a dual core requirement & you get a HD4850 or an 8800GT, you do realise that your PIV going to bottleneck most of the games you play to a great extent, right?
C.) Yes an upgrade for your current processor is a must if you ought to buy a good graphic card later on.Not with GTA IV in mind but all the other games coming out in Q4 & post that.
One more thing, from your current sig I guess you will have to upgrade your PSU too.