Unfortunately, you need BOTH. No matter which thing you choose to upgrade, the other bit will become the bottleneck.
However, I would recommend you do the mainboard/CPU upgrade at this point. My reasoning is that the ATI 9700 is both extremely expensive, and not really utilized right now. You could get by with the GeForce GTS for a while, and then once the price of the 9700 drops or the next nVidia card comes out, you are good to go.
I also would not pick that mainboard. Serial ATA is irrelevant right now IMO. You won't use it for long enough that you'll be into your next upgrade before then. I just built a machine on an nForce board, and that's what I'd recommend. Lets look at this:
(from Pricewatch.com except RAM)
AMD Athlon XP 2100+ = $ 117
Abit NV7-133R with sound and LAN = $ 89.00
Crucial 512 MB PC2100 DDR = $ 142.00
GeForce 4 Ti 4200 64MB = $ 125.00
Ok some of the pricewatch prices are a bit optimistic, but you can get all of that for about $500.00. That gives you a great CPU, lots of decent RAM, and a great value and plenty fast video card. That's what I would do if it was my $500 right now.
Also you can possibly sell your old system and get enough to put new gear in this new one like HD, DVD, and/or CD burner. That mobo has great onboard sound and decent onboard LAN. What else do you need?