I have also experienced performance problems with XP, having got my XP Home with a fresh install on my 500AMD machine with 512Mb RAM, I have found it to drag and perform slowly compared to how it performed with 98 or NT4.
Even though it is a bit slow I will say however it is stable and generally I am happy, not with the firewall but that is another story.
I have set it up on a test machine and blasted it when finished I put in my Me boot disk and formatted the drive no problems and then installed Me again.

So my opinion is not perfect, but they are getting better.
If I had a faster machine I dont think it would drag so I will have to put up with it until I get something faster.