This from MS Database:
Alter Your Virtual Memory SettingsWindows Millennium Edition (Me), Windows 98, and Windows 95 use virtual memory to augment your computer RAM. Virtual memory is a method of using your hard disk as temporary storage for data that may normally be stored in RAM. By using this method, Windows can provide extra resources that effectively add additional "virtual" memory and extend your computer's capabilities.
WARNING: Although you can alter the virtual memory settings, they are already configured for you by default; do not alter the virtual memory settings unless it is absolutely necessary to do so. Also, before you alter these settings, note the current configuration information so you that can restore the original settings if necessary.
To alter the virtual memory settings:
1. Right-click the My Computer icon on your desktop, and then click Properties.
2. Click the Performance tab.
3. Click Virtual Memory, and then click Let me specify my own virtual memory settings.
4. Click the hard disk that you want to use for virtual memory, and then select the minimum and maximum amounts of virtual memory.
5. Click OK, click OK, and then restart your computer.
NOTE: If necessary, you can restore the original settings. To do so, repeat steps 1 through 4, but click Let Windows manage my virtual memory settings (Recommended) in step 3.
Might be worth a try, Taffy, but also as Hookstar suggested, check for spyware and / or viruses as well. Might also be worth checking the Task Manager to see what seems to be hogging your resources.
If you're not sure what to adjust your VM setting to, as a rough guide, I find that a maximum of 3xRAM seems to work quite well. I don't think the minimum setting is all that important.