The i7-3770k is a fantastic processor! Out of the box (with no overclocking), I got a Windows Experience Index rating of 7.7 (on a 1.0 to 7.9 scale). The CPU installation is quite easy and the 'k' at the end of 3770k means the processor is unlocked for easier overclocking. The HD 4000 graphics are also great! I got a Windows Experience Index of 6.5 in both graphics categories without the need for a discrete GPU (if you don't need serious graphics performance, this processor could save you money on a graphics card!).
This chip laughs at anything I give it. It can transcode a 1 hour 45 minute HD video in just a few minutes without using most of the full force of the processor (my particular trial lasted about 11 minutes and utilized just under 20% of the CPU power including my internet browser).
I do have a few light reservations, however. First, the price is going up (at least on amazon) and will eventually drop off a bit. The recommended retail price (given by Intel) is around 320-330 (similar to what the i7-2700k goes for).
Second, the Intel Core i5 3570K Processor 3.4 4 BX80637I53570K shares a lot of the great features of the i7-3770k for a lot less money (100 dollars or more cheaper). You lose 2MB of L3 cache, 100 MHz in clock speed and turbo speed, and the hyper-threading technology when you move down to the i5-3570k. But you keep the HD 4000 graphics and the unlocked processor for overclocking (the i5-3570k might even be slightly better for overclocking purposes which could make up for its 100 MHz decrease, and even some of the hyper-threading). In general, if you have software which can fully utilize 8 threads, this processor is probably worth the extra cost.
Third, the ivy bridge lineup does run a bit hotter than sandy bridge, but this is completely expected from a smaller architecture. This shouldn't be much of a problem (very good overclocking with air is still easily possible and extreme cooling allows for some incredible results) but upgrading from an overclocked sandy bridge might not make much sense - unless the HD 4000 graphics are worth it for you.
Overall, this is one of the greatest processors available today (definitely the best performer on its socket type). Any processor which beats this one costs at least several hundred dollars more and doesn't gain nearly that much in extra performance. So, if you can handle the somewhat higher price than the i5-3570k, get this beast of a CPU!