I personally don't like using logical partitions. Let's just say I've had experiences which give me good reasons for this stand and leave it at that. If you are running NTFS, there is really nothing to be gained by partitioning a drive anyway.
Here is how to tweak the most performance out of your single-drive setup:
First, disable your paging file altogether. Windows will warn you of the impending apocalypse, but worry not. Unless you are running many more start-up applications than anyone should, 256MB of RAM is sufficient to boot Windows XP.
Then go into the tools menu of any folder and click on "folder options." Enable viewing of all hidden and system files. Windows will again warn you of dire consequences. Ignore it. Find "pagefile.sys" and delete it. You read right! DELETE IT!
Now, run the defrag utility. Go to lunch. It will take some time.
Finally, go and re-create your paging file (the pagefile.sys I just asked you to delete). Set both minimum and maximum size to be the same. With 256MB of RAM onboard, I would not set it any larger than about 256MB, unless I planned to run a high-resolution scanner or something that might want to write a huge amount of temporary data into the paging file or something. In any case, making it larger than 384MB is a total waste.
Now, you have a defragmented drive with a fresh defragmented paging file that will STAY defragmented.
The reason I had you delete the pagefile.sys file before running the defrag utility is because Microsoft's defrag utility won't defrag the paging file. At least older versions wouldn't. So I delete it and create it afresh. If it's set to a fixed size, Windows won't fragment it again.
A side bonus of a fixed-size paging file, besides less HD gnashing and grinding, is fewer processor cycles wasted in "managing" how large the dynamic paging file is to be from one moment to the next. Windows then just uses it when required, but otherwise leaves it alone. If you've got a 2+GHz Pentium 4 under the hood, paging file management overhead is a trivial matter, but with a much slower processor such as yours, every processor cycle not doing actual productive work (even - especially - if that "work" is something like QuakeIII
) is a waste that should be avoided as much as possible.