I'd go for the intel, even if it's clocked lower, it has much more overclocking potency, and they are running much cooler.
Just built a system for my little bro, 5200+, 2GB ram and an HD3870. I regret chosing AMD, but didn't have a chance to go for the Intel, because of the lack of time (store didn't have any Intel in that price range). GTA runs, but gives around 15-20 fps in average, with all the things set to minimum that use mostly CPU.
So go for the Intel, even a low-end one can easily hit 3-3,5+ghz.
And for the PSU, don't overrate it too much. The closer they are running to the peak output, the more efficient they are. I'm not saying that 400W one would fit the system, but a 450-500W branded PSU is enough. I'm using a 5 yr old 460W Enermax, has no problem with a C2D@4ghz, 4gb ram, HD4850, 6 HDDs and 5 fans.