There are so many options available in multimedia encoding that it's almost impossible to say anything clear-cut about it.
But in general, the greater the compression, the more cpu power needed to decode it. H264 is one of the newest of the modern high-compression-high cpu formats, so it's natural for a low-powered system to have trouble with it. You'll probably want to look into some of the older codecs, the ones available 5-10 years ago. My first thought for a low-burden codec is mpeg1, but you really need to just experiment with various codecs and see for yourself what works best. If you're lucky xvid or theora do a good enough job. Of course, lower compression means larger file sizes, so there's a trade-off involved.
Reducing the frame size, frame-rate, and bitrate can also have a large effect. The less data in the file, the easier it is to process. But of course this also means reduced image quality, so again, it's a trade-off.
Last edited by David the H.; 08-06-2010 at 06:38 PM.