Basically an overclock on the graphics card is good if you can run all your games without anything looking weird, such as artifacts or strange textures. I use RivaTuner (works for both NVIDIA and ATI cards) to overclock and 3DMark to check for artifacts. Once you OC to the point where anything looks weird just back down the clock one step and you should be fine. The methodology is similar to CPU and RAM overclocking.
RivaTuner:
http://www.guru3d.com/index.php?page=rivatuner
3DMark:
http://www.futuremark.com/download/
Note that the latest 3DMark Vantage only works for Vista systems.
Before you overclock anything, please make sure you're computer isn't overheating as it is. Your CPU should be below 60C during load and graphics card under 70C. Also check that your PSU is capable of handling your system. Info:
Power Supply Information and Selection