I've found that the customization doesn't slow down the machine that much. However, you should make sure that windowblinds ignores certain programs like games and anything that goes full screen. I have found it causes some problems with games. Other than that, haven't had another other problems with these programs running in the background.
Finally could edit this. I just noticed that you were also talking about a 500mhz processor with minor amount of RAM. My suggestion is to upgrade!!!! I currently run my 700mhz machine alot, but it has 640mb of RAM. Soon to be upgraded to a AMD XP 3200+ processor and 256mb of RAM for right now.