One of the issues people face when upgrading with this series system is making sure they don't put to much money into the system when its life space is limited. So be careful here you don't over buy.
With that said yes you can put a SSD into your system but you do need to make sure the SSD you get is able to run at SATA II (3.0 Gb/s). While SanDisk is a good SSD I do believe its a fixed SATA III (6.0 Gb/s) drive. So you'll need check if it offers SATA auto sense so it can run in your system. If not, you'll need to locate something else. Here's a writeup on the comparing a SSD under SATA II vs SATA III interfaces: Is A SATA 3Gb/s Platform Still Worth Upgrading With An SSD?
What I recommend is getting a SSHD here as it will give you the speed of a SSD in the boot up as well as the deep storage of a traditional HD. I would check out the Seagate desktop SSHD. Here's the data sheet for it: Desktop SSHD. Review the SATA Transfer Rates Supported (Gb/s) line note it lists all three data rates 6.0/3.0/1.5 of the three SATA specs SATA III, SATA II, SATA I.
This maybe a better upgrade for you as it will be cheaper and yet offer boot up and limited app speed improvement inline with what a SSD offers and still offers the deeper storage of a HD that one often needs.
Lastly, here is the IFIXIT guide you'll need to follow for either: iMac Intel 20" EMC 2266 Hard Drive Replacement. With a SSD you'll need a 2.5 to 3.5" frame to hold the drive and don't forget the thermal sensor! you'll need to transfer it to your new drive (either).