As a long time PC gamer I can give some inputs regarding screen resolution, video ram, and stuff.
First off, screen resolution gives one of the biggest impact on performance AND graphics quality. Playing on anything less than the native screen resolution (1920*1080 for the 21.5 inch, 2560*1440 for the 27 inch) - especially on glossy, high quality displays like the iMac - will make everything look blurry. Well, not mosaic-like blurry of course, but try turning to the native resolution for just a few seconds to compare and you'll find on native resolution it's looking MUCH more crispier.
That's one of the reason why I would prefer the 21.5 inch over the 27 inch - 650m running with 1920*1080 can have a much better performance than 660m running with 2560*1440. In order to run on 2560*1440 smoothly you need to have a 675m at least, which is completely out of my budget.
Some may say isn't 650m too weak or something? Well, don't forget that on High settings of most games (including Arkham City and Skyrim), 650m can get a consistent 40-50 FPS which is very nice. And even more importantly, with a couple of slight tweaks with the default High settings - turning off AA and turning down shadows, both of which are huge fps killers, for instance - will instantly provide 10-15 FPS boost, while reducing the graphics quality only very little.
Concerning video ram, I think 512 might not be enough to handle 2560*1440 at all - yet another reason why 660m sucks for the 27 inch - but should handle 1920*1080 adequately. Note it's JUST adequately! When your VRAM isn't enough, you may see textures in the farther places popping up, or you may get some slight stuttering when you're let's say moving from one major area into another (as the video card needs to load a lot of new textures). I've also read that Kepler cards can use system RAM when the VRAM is used up, although the speed is still much worse (but at least it's much better than using your HDD caching):
http://www.tomshardware.co.uk/forum/342932-15-kepler-cards-pulling-system-vram-runs
Finally, I'm not saying that the 650m is oh-so-powerful or something, but at least it's the most cost-effective if you want to game on the iMac. 640m is too weak, 660m is too weak FOR THE 27 INCH (and I don't need the 27 inch anyway), 675m/680mx are too expensive.
Man I miss my gtx 560 on my older PC ;(
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I did not realize that no. In which case I assume the 650M is a better card than my first impressions showed me.
Granted, it was running on a 2.3Ghz i7 with turboost and 8GB 1600Mhz ram.
You'd think a game form 2008/2009 would run smoothly on a processor like that.
It also may have to do with optimization. A lot of games' CPU handling, or graphics like shadows eat up way too much resource for too little extra effect for instance. NWN2 for example was notorious for not supporting multithreading, and a lot of Russian games are infamous for their ruggedness (i.e. bad performance on high specs).