The note mentioned a "sophisticated tool". Don't no much about it. Just passed on the information. I saw the same results with System Monitor and dismissed them when I realized my system was running great. I mean when System Monitor makes claim of 100% processor usage that is absurd. Your machine would be frozen.
Anyway, onto your performance problem. I would say you need to update the Via 4-in-1 drivers to get AGP working properly. When you install them you can select Turbo to get 4X but there is very little improvement over 2X but do turn it on here. (I'll talk about that in a bit). Also, the fastest Geforce Drivers are 6.50. 6.31 is the official release by nVidia. 6.67 gets the quality nod from Microsoft. 7.17 is the latest experimental drivers, slow but supports more directX 8 features. You take your pick. I use 6.50 and get a 3Dmark 2000 score of about 5000, on my KT7, with a Duron overclocked to 900 mhz, and a Geforce256 SDR slightly overclocked to 135/180. (I can get to 5549 with maximum overclocking). I'll try to pass on some info that will help you.
You are using PC-100 memory. That will handicap you by about 5-10%. I advise you to get pc-133, cas2 memory when you can. 128 mb only costs $61 at www.crucial.com with free shipping in the U.S.A. Even with PC-100, you still should be getting better scores (and you will with the 4-in-1 drivers).
For more speed we can do some Bios tweaks. Your system, I assume, is stable so we won't mess with memory timing with pc-100 DRAM. However for performance enhancement I recommend you turn on 4-way interleave and 4-K page mode(for more than a 5% improvement). Also you could turn on 4X AGP and Fast Writes but I have found together these increased my 3Dmark scores by only 49 points. Since I have heard that 2X is more stable with the Via chipset that's what I use. Also, because on a KT7 mobo to make Fast Writes work you have to turn off Enhance Chip Performance (This is a bug that maybe fixed in future BIOS updates). Neither of these have much effect, anyway.
That's about it. With good PC memory you can select CAS2 and Fast or Turbo DRAM timings for noticeable gains (in benchmarks).
There are other tips for increasing I/O performance but you can read about these at Paul's unofficial KT7 FAQ, a great resource I might add. Here is the link.
http://www.icrontic.com/faqs/kt7faq/kt7faq.htm.
Well, good luck.