Your ideal weight depends, as Annie said, on whether or not you like the way you look, as well as other physical factors. What's your height? Sounds like you might be fairly tall to be able to weigh 205 lbs and not look it. Muscle tissue is much denser (tightly packed) than fat tissue (fluffy and makes us look larger), so it's true that really muscular people often weigh as much/more than people who look fatter.
I'm not real keen on "diets" per se... A diet is simply what we eat - it can be good, bad or indifferent. A healthy mix of the various things our body needs is the best diet there is.
I might also mention that it's a good idea to change up your exercise routine... cardio tends to help with weight loss, while weight training builds muscle. Muscle, in turn, burns fat, but since muscle is denser than fat, doing all weight training will keep the weight on - just in a different form. It doesn't sound like you could have much actual fat on your body.
The last thing I'd mention is that there are some medical conditions that can weight issues, including insulin resistance, as well as hypothyroidism. Insulin is known as the "fat storage hormone" so insulin resistance causes fat to be stored instead of being used for energy. The thyroid controls metabolism, so if you don't produce enough of the active thyroid hormones, weight loss will be difficult to impossible. Again, it doesn't sound like you have much actual fat on your body, but it never hurts to rule out medical reasons for not losing weight.
It is true that muscular people weigh more for their dimensions than people who don't have much muscle -- fat weighs less. If people are shocked when you say you weigh 205, you must look pretty good. When you were 165, were you also lifting and had a lot of muscle mass? Because if not, it sounds like you might look about the same as then.
I guess what I'm getting to, is if you like the way you look, the number on the scale shouldn't be enough to tip you into major depression. Is something else going on? And, do you have a counselor or therapist? So much of weight gain and loss is a psychological battle, not of following a diet. In my life, when my head changes, my body changes. If you don't have a therapist, you might look into the possibility.