You can see what kind of video card you have by going to START > Run > type "dxdiag" > Display Tab.
You won't need a new video card to run Adobe Creative Suite. Your video card has absolutely NOTHING to do with your performance in Adobe Creative Suite. The things that will effect your performance are RAM capacity and Processor power. You already have enough Ram, and any Pentium 4 processor or above (or AMD equivilent) is pleanty to run Adobe Creative Suite.
You would only need a new/better video card if you are getting 3D modeling software, such as NewTek Lightwave, Maya, or AutoCAD. The video card's power only comes into play when rendering 3D environments, Adobe Creative Suite doesn't deal with 3D at all, it doesn't have that capability, so that's why your video card irrelevent when it comes to Adobe Creative Suite. Creating images, textures, layers, etc... etc... is all done by your CPU.
In reguards to your screen resolution. That doesn't mean you have to run your monitor at 1024x768, it means the minimum is 1024x768. If you are running your monitor at less than that now, that's not a good thing. If you have an LCD monitor you should already be running at at least 1280x1024.