do a search in the tech support section key words anti aliasing posted by skuzzy. i've experimented with it offline, on my 6950 2gb and my old 4870 1gb. frame rates took a hit regardless of which driver version, even at the lowest aa settings available. to be frank about it, i didn't notice much difference with the hi-res pack installed. a big 4gb video card could probably handle 2-8x aa without supersampling.
Gyrene, the first one he's talking specifically about a guy running a GeForce 8800, the second one he's considering only 32-bit systems, and the third was Challenge's system which was pretty much maxed out on every detail he could find.
Regarding AA: FSAA doesn't hurt
that much. You use just 1 or 2 notches and most systems can handle that just fine. Just enough to get rid of the "jaggies" so to speak. Running 8x, or more, you can't physically see the difference anymore. It's just bragging rights.
I run just a notch or two on my AMD 6970 2GB, I have shadows set to moderate resolution, I have textures maxed, I have all the goodies enabled
[Edit: All the AH goodies, my card settings are balanced between performance and looks], and I'm running 3 monitors at 3840x1024. It's all about moderation. If you try to super-max-out every single last card setting, you're just eating memory at a geometric rate and gaining a small % of improved quality. It's about setting the card right.
And, for higher memory limits it's a must to have a 64-bit OS installed. Or otherwise, as Skuzzy mentioned, you probably aren't using all of it.
P.S. I'm still on 12.3 drivers. Never saw much need to update. No bugs, glitches, etc. It might improve some performance but I just didn't want to be bothered to test it and see.