348 is still very low amount of RAM. XP really needs a minimum of 512Mb to run half decent.
You could try running MSCONFIG and clear out stuff that runs on startup.
The more stuff your PC launches at startup the more memory it hogs and the slower it becomes.
http://www.netsquirrel.com/msconfig/msconfig_xp.html
A clean install of Windows XP should also speed things up. Do you have the original installation CD ?
You could also try following these instructions: http://www.tek-tips.com/faqs.cfm?pid=779&fid=4784