Just a suggestion, but Windows 2000 would run A LOT better on that setup. Windows XP probably runs somewhat decently, but if you compared running games from Win2000 to XP on that system, XP will eat more resources and slow your overall performance down.
As to which emulator you should use, PSX is probably the best to try (though you said you already did), and EPSXE needs too much power to run well on your system. PSX is your best bet though...just make sure you have the d3dx9_26.dll off of the main page of PSX
pSX emulator
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