12% isn't so drasctic if you are running XServer with Kde, xmms, few application running while surfing on internet...
And your video card isn't powerful, so your cpu probably have to make few more calcul.
But still, my xmms player still playing even if my cpu hits 99% of use.
You might have some other troubles. Take a look if you have enabled DMA for your hard drive (type man hdparm). Also make sure you don't have a lot of useless application running (RedHat is annoying with the very heavy "updatedb" starting every boot as example)
If you want to "see" what is the application consuming your cpu, try "top" and then type "P".