Thanks to both Leon86 and [GLT]Myke. Thats exactly the type of advice I was looking for. I am going to check how arma runs at different setting with my current set-up, clean out my case with air for maximum cooling, then try some modest OCing using your guy's advice. I have a feeling a new GPU is a good idea no matter what as I can always use it with any other upgrades I make in the future. I'll keep you up to date on my findings as I learned a lot from reading other people's outcomes.
OK, results of benchmarking are done. FPS has huge improvement with shadow from low to high. Shadow very high = 32fps shadow disabled = 47fps. This seems to indicate my GPU is hurting.
The difference between Antialiasing (with disabled shadow) is much less marked. Disabled AA = 47fps Very High AA = 43fps.
For what it is worth my 3d resolution is 1120x700 (67%) with high setting on vid memory, all other settings low or normal and with vsynch enabled.
It seems, using your guys advice, that upgrading my GPU makes a lot of sense and a modest OC might get me pretty good performance with that new vid card.