How can I make this game (and others) run better on my rig?

I don't know why, but I can't run this game or Ark for that matter, on anything higher than medium. While playing this, and ark, I get around 20-30fps. I'll list my stuff below, but what should I change?

Processor: Intel i7-4770 @ 3.4Ghz (8 cores)
Graphics Card: NVidia GeForce GT640 @2GB (dxdiag is reporting only 1.21ish available for some reason)
Ram: 16Gb
OS: Windows 8.1 64-bit

You are mostly being held back by your GPU at this point. The 640 isn't a bad card per-say, but on all fronts its specifications are pretty weak

As to 2gb vs 1.21gb; this is likely just the difference between reporting size in bits versus bytes. Manufacturers and Internet company like to use gigabits because it makes their numbers look better; your OS reports it as gigabytes.

Some more RAM couldn't hurt if your MOBO can support more; but I will say that to everyone I meet until their MOBO is maxed out.

The GTX 970 is a very capable modern GPU for a reasonable price.

You could start by changing out the three year old, sub-budget, sub-par, graphics card....

I get a smooth 60 fps on ultra settings no matter what is going on around me. My system is:

i5 4690k
GTX 970
8 gigs of ram
Windows 7 64 bit

I think your weak spot is your GPU as that is the only part of my box that isn't inferior to yours.

Isn't 1.21 GB what Doc Brown needed for his Delorean? LOL, just messing with you.

You'll notice a world of difference with a better GPU, like a cheap example a Nvidia 750 / 760.
That 640 is too weak to withstand even some source games.

It's not really 8 cores, it's 4 cores, which is "doubled" by Hyper Threading technology. It gives some performance boost in multi threaded programs, like video editing and graphical design. Not really applied to games, though PS2 did receive a notable buff in multi-threading recently.

16 GB RAM is plenty, considering this game needs ~2.2 to run, so don't listen to the guy who said "get more".

Video Card is indeed the weak point, so as others said - you should look into upgrading it. I recommend using this article on Tom's Hardware to choose a new one. All of those are good choices for their money, GTX 970 being probably the best investment currently.

In the meantime, check out Performance Guide to help you customize game settings to give you the best performance / looks combination, link is in my signature.

Thanks guys for the feedback. Upgraded the videocard to the 970 like folks suggested and the difference is night and day. Wow. Now I'm getting a smooth 60fps everywhere. Thanks everyone!