i have an xp system, about 756 mb of ram, a 30GB hard drive and less than a gig processor
works fine for me, not the fastest shit in the world but im able to animate and render effectively.
i do have to make my objects boxes when i have too many objects but most industry proffessionals work strictly with wireframes/boxes unless modelling or rendering.

the whole lookin for files slows it down thing may have some effect but i wouldnt dwell on it too much,
it sounds like your graphics card dude,try upgrading, you have seen my system specs,
not too great huh, im working on a tablet pc so no chance in upgrading graphics cards but luckily mine packs a pretty strong stink although the rest of my system isnt too hot.