go for Sapphire Radeon HD 5850 Xtreme if you can get one, crazy cheap but limited editon.
you don't need to OC, stock work great with wii and gamecube game, even using LLE.
but if you really want to OC, get better cooling. hyper 212+ is good, and cheap

i use this cooler myself, quite satisfied.
considering i life on tropical country, 36-37 degree celcius cpu core temp on normal usage and rarely goes beyon 45 degree on gaming (or 50 on intense cpu usage like emulator), sure is cool ^_^
for PSU, atleast get 550W and make sure it's pure power.
mobo, if you want to overclock (seriously with K series, you should). get motherboard with with P67 chip, or z68 (tend to be much expensive) to get OC capability.
asus P8P67 pro, asrock p67 extreme4 (that i use), both are nice andaffordable for a premium board (since you're low on budget)
ram, get 1600MHZ 4GB kit, geil ripjaw would be nice
for hdd, get any lower speed sata 3. i use 2 caviar blue sata3.
lol, 2x 500GB blue are cheaper than 1 TB black, and on raid0, is way faster than black
