A few points of fact:
1) The 295 is pretty close to 480/570 performance. Even a 560ti is at best a side grade, most games it'd likely be a slight downgrade, as would be a 470 (although 470's are monster OC'ers).
2) The 560 non-Ti is obviously not as fast as a Ti. It may be able to match it with a large OC, but the Ti can OC to be quite a bit faster.
3) You'd not be losing memory, you'd be gaining memory. The GTX295 has an effective memory capacity of 896MB, the 560 has 1GB.
4) The general consensus I've seen is that the 560 non-Ti is overpriced for what you get.
5) What your friends are telling you is wrong. Not every 500-series card is > GTX295. A 570 is marginally better, and of course a 580 is considerably better. But the 560's are, like I say, a sidegrade at best, in terms of performance. They do run quite bit cooler/quieter though, and have DX11.
Bottom-line this would be a fairly significant downgrade in perf, and you're going to be spending money to do it, plus dealing w/the hassle of selling your current card/shipping it to someone, etc.
Unless there's some game that you just HAVE to play in DX11 mode ... I would think twice about this move. As mentioned above, anything less than a 580 is not really going to perform noticeably better ... and even that is a horrible 'bang for buck' proposition unless you can sell your 295 for a REAL nice price.
Edited by brettjv - 6/15/11 at 11:50pm