The HD5850 is a great buy and you can pick them up for £195 if you look around, besides performance the card offers it's highly efficient with its power usage which in turn makes it cool and quiet which is a complete contrast to the Nvidia options which tend to be hot and loud.
If you can put up with the heat and noisy the GTX470 retails for around about £240/£250 for the cheaper models, they have good DX11 performance in a game like Metro 2033 which might appeal to you. Overall there not much faster then the HD5850 (about 6% based on Anandtech review) and in some cases there slower in older games like Crysis. The other main selling point for the GTX470 is there board partners do offer generous warranties which is something to consider when paying big money for these cards.
If you apply some lateral thinking there is a 3rd option – 2x HD5770’s in Crossfire. To be honest 1 HD5770 is more then enough for most games and would keep you happy (but depends what you upgrading from) but 2 of these cards will give you performance that’s a bit better then a single HD5870. The reason for this is because scaling on the HD5770 tends to be a lot, lot better then it is on ATI other high end cards, I don’t know the reason for this but they just scale better. The only draw back with this option is it would take you to the top of your budget but its good value for money.
- HD5850 - best all-rounder, good value for money, quick, overclocks well, cool & quiet. DX11 performance not as good as Nvidias offerings.
- GTX470 - Great DX11 performance, good overall performance, good warranties. Hot and loud, more expensive then a HD5850 and not much quicker.
- 2X HD5770's - This will give you the best performance offerings for you budget, cool and quiet, driver releases can be flaky and top end of your budget.