Tom,
Definitely look at upgrading the Ram first - XP home uses about 700MB of ram without anything else running once all the security patches have been applied. This is really cheap and easy to do and can give a couple more years life to an old machine.
I am finding more and more problems with common antivirus tools slowing windows machines down. It seems the most popular AV tools get targeted by the virus writers. Try some of the free ones like avira and a firewall.
Try opening up task manager and finding the processes using the most CPU. Google the Process name and see what comes up.
Failing that, a full rebuild every once and a while of a windows machine is a sure fire way of speeding things up.
If it was a Mac, I would really recommend getting an SSD drive put it. I just did this for my wifes mac, and it takes less time to startup/shutdown than our Plasma TV does. I don't recommend this yet for Windows as the Operating systems are heavily geared to older hard disk drives, which can be problematic. This is meant to be solved with Windows 7.
