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Always run the latest driver unless you are having issues with it.
And that loss in performance you are talking about in the OP is most likely due to garbage running in the background. Malware etc..
What are your specs?
It depends on the game. A CPU bottleneck isn't something that's always present. It will only hold your GPU back if you're using an application that requires a stronger CPU than the one you have.
for modern games an 870 Is pretty crap though.
Drivers have been unified for years; meaning they (at least for NVIDIA) support as far back as the 400/500 series GPUs all the way to the very latest TITAN, in every driver release to date, since those older GPUs I speak of were new. Now sure, most of the improvements are aimed at the much newer GPUs and newly released games. But that doesn't mean they in any way hinder old GPUs such as yours.
Unless you have a particular issue with the very latest Driver, that is always the best to use, again unless you otherwise find an issue, then well, thats on you to figure out what older version is most stable for you.
Especially as the Win10 build updates change over time, you basically must use newer drivers because older ones either have issues or wont work on newer OS builds.
Overall, a GTX 960 wasn't even good at release to be honest, at least not a GPU that was made to hold up for many years worth of handling the most demanding games at highest visual settings. There is very little to possibly squeeze out of older GPUs such as that.
You should ask the advice of Omega and Bad_Motha long before me, both these guys are way smarter.
A newish I5 would be more than enough for a 960 in my opinion. But you have to consider if you intend to upgrade your GPU any time soon. There's no point buying an I5, then grabbing a 1080 next year because you'll just be in the same position you are now.
That is more than enough for even a GTX 980 to shine at it's fullest.
If anything I'd provide a realistic budget and see what we can come up with for upgrade suggestions. You're better off getting a newer GPU too, since GTX 960 really doesn't cut it for demanding games at 1080p + Ultra @ 60+ FPS