In a side project, we have a 1999-2000 Compaq Presario 1900 laptop that runs Windows 98 SE and is on its last legs. After we bought our main desktop, the laptop fell into disuse, and was not revived until I set up our Ethernet network a couple of years ago. Even then though, it takes about 8 minutes to fully boot up and moves VERY slowly when performing even the most basic tasks and crashes often. This was my wife's computer when she was a student about 6 years ago and she intentionally bought it to be as bare bones as possible, because 1) she just needed Internet access and word processing capability and 2) laptops were quite expensive at that time.
Here are the specs:
Pentium III Processor
64 MB RAM
3 1/2 floppy drive (out of alignment and not functional)
6 (?) GB Hard Drive
1 USB port
CD/DVD ROM drive (no writing capability)
The PC Magazine Linux Book that I was consulting mentioned using "Puppy Linux" on older PCs with low memory specs. Once we got DSL again I downloaded the ISO from a mirror site and tried it out on the Compaq. It works fine, though when running it the first time it was awfully slow because of the small amount of RAM. What Puppy does, however, is create a file (which can reside on your hard drive) that keeps your settings, documents, etc., so when you log in the next time, it doesn't have to use as much RAM and programs run fine. Much much faster, in fact, than Windows 98 ever was. I have to boot from CD to get into Puppy, and Windows is still on the PC, but I don't ever have to use it.
I've had a little trouble configuring the network to provide Internet access, but I'm confident it can work. Of course, this means I now have 4 computers. Who needs 4 computers??!