One thing to note though is Linux isn't some magic operating system that makes obsolete hardware new again. It is possible to get decent hardware running with a modern distribution like Mandrake 9.2. Just stop all of the unneccessary daemons and turn off the graphical enhancements (eye candy) and it'll run fine.
Yes... This isn't stated enough. Lots of times the argument is used the Linux extends the useful life of hardware, etc. What isn't mentioned is that you can't expect the latest features to run on that older hardware.
For the most part, if you stack up, feature for feature, a Linux build against a Windows build, the Windows build will run faster. The thing is, Linux can be trimmed down and lightened. But, you do have to be a more advanced user to know and realize what you do and don't need to have a useful system.
This makes the learning curve for starting on low-end hardware even harder. Not only do you have to learn Linux, you have to try to learn it from a build that may be either too large or too small for your situation.
The larger distros (Mandrake, Linspire, Fedora) are very easy to learn and use. These have graphic installers and package managers that are quite a bit better than found in Windows. But these distros need horsepower. And lots of it.
The smaller distros (and the BSDs and whatnot) are much more difficult, if you're new to them. But they can run faster, because they are a little trimmed back... So they don't need quite as big a system... It's all a trade-off.... And finding the sweet spot is tough.