Overclocked i3 GPU
I have an i3 530 and I've been experimenting with overclocking the GPU before my new graphics card arrives in the mail. My i3 is oced to 3.5 currently. I have a Bclk of 160 x22 and GPU frequency of 733 in the BIOS, which results in 881.8 Mhz GPU.
I have seen great improvements in playing HD video, which was very choppy before I overclocked. However, it's still way too slow to play Starcraft 2. So, I upped the GPU frequency to 833, which should give me a 1002 Mhz GPU. However on this setting video became unstable and it kept trying to switch back and forth between video modes when I loaded Starcraft 2. Realtemp showed the chip running a little hot, in the 60s, but I don't think the problem was just a lack of processing power. I suppose if I upped the voltage it might help but somehow I doubt it would be enough to run Starcraft 2 even if i were able to successfully oc it above 1000 Mhz.
So, in response to your question, you should definitely have a dedicated graphics card and not rely on the i3 igp to run WoW. However, for the money I think the i3 is a great processor, I would recommend it even if you aren't going to use the igp.