It's sluggish and slow, in everything I do, from opening IE, to going back to the desktop to clicking between windows, even when I have barely ANY actual applications running. My system has a Pentium 4 CPU 2.40Ghz and 256MB RAM, I thought that was FAIRLY good, why is it having so much trouble doing the simplest tasks?
Open Task Manager (Shift+Ctrl+Esc) and look on the processes tab and see if there's anything in the list using a large amount of CPU - that'll probably be the culprit slowing everything down for you if it is a program causing this.

Edit - Oh another thing, in the address bar of internet explorer, when you click on the little arrow you get a drop down box of addresses, well mine seems to choose to remember a few addresses here but not all, and some I'd rather it didn't remember, how can I get rid of them? I tried emptying my temporary internet folder but that didn't do it.
Try clearing the history as well, and/or setting it to 0 days to wipe those.