I'm on a desktop but it's running WinXP Pro with 550MHz and 384mb ram. I have 842 fonts installed. I never had a problem.

You do mention other applications. How many other programs are you running at the same time? What size file are you working on in PS7? Make sure your History States and Cache levels aren't set too high and the Memory Usage set at reasonable percentage. BTW .. it's best to open Photoshop last.