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Originally Posted by eschwartz
I am currently trying to do something useful with an old laptop of my mother's. It's the Dell Inspiron B130, WinXP, 40 GB HDD, Intel Celeron M 420 processor, and has 256 MB RAM also... I just ordered a RAM upgrade to 2x1 GB so when I get it hopefully I can get something to actually run... 
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2GB RAM will provide a
very nice performance boost for XP.
XP, like other moderns OSes, is a virtual memory system. The total memory for the system will be the amount of installed RAM, plus the swap file.
XP divides RAM into 4K pages. When you do something that wants RAM, and there isn't enough free RAM to fulfill the request, XP swaps pages not recently used to the swap file to free enough for what you need. If something tries to access a page that is swapped out, a page fault occurs, and the page(s) affected are swapped back into RAM.
PCs are I/O bound, not compute bound. The system is usually in a wait state, waiting for things to be read from/written to disk, and as a wag once said, "all machines wait at the same speed."
RAM is an order of magnitude faster than disk, so one thing current systems do is cache disk requests. Generally, what is desired is already in the cache, and can be read from there rather than being fetched from disk.
Adding more RAM means the system can do a better job of caching, and be less likely to need to swap. Adding more RAM is the first thing I recommend to improve performance on an existing system. A faster processor won't normally help that much, because the bottleneck is usually I/O.
Linux systems behave the same way, though the details differ, and the same considerations apply. A 2GB RAM system should provide a very nice Linux platform.
(My p2110 can be expanded to 384MB with a daughter card, but that's it. And while I can still get the 128 MB daughter card, it costs more multiple gigabytes of RAM for a more modern system. No thanks. Not worth it.)
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Looking around for a replacement HDD, it's been suggested on various places the hardware can't handle larger than 120 GB. But I can go all the way to EIDE. W00t!!
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The 120 GB barrier is likely a BIOS limitation. ISTR hearing about that elsewhere. What you might look at is an SSD drive.
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I was thinking of installing Arch Linux, because it sounds fun
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Dennis