Before you throw money at it:
Go to "TASK MANAGER", and check your CPU usage, check your memory usage (PROCESSES tab). Find out what is eating your CPU cycles/memory up. Windows XP normally runs around 30-35 processes at idle, total memory usage should be under 250 megs. You can use msconfig to stop many startup programs that you don't need: http://netsquirrel.com/msconfig/msconfig_xp.html
Make sure your antivirus/antispyware is up to date. You might want to run Malwarebytes and/or SuperAntispyware to see what lurks on the hard drive. Also consider an online scanner to doublecheck: http://www.eset.com/onlinescan/
512 meg of mem is about the lowest you can run with XP and not tear your hair out waiting. The problem is you have to have a clean system so that 512 meg doesn't become a limiting factor. Simple stuff like drivers (HP printers especially) have unneeded processes running that can be disabled.
Hard drive performance can slow a system as well. Defrag it, clean it up, get rid of the garbage on it.
EDIT: You have onboard graphics which will eat up a signifigant amount of memory.
Edited by dpunisher, 08 October 2009 - 10:08 AM.
I am a retired Ford tech. Next to Fords, any computer is a piece of cake. (The cake, its not a lie)
3770K @4.5, Corsair H100, GTX780, 16gig Samsung, Obsidian 700 (yes there is a 700)