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Please keep in mind, I am a newbie (~10 months on linux) and this is only my opinion...
I would go with Fedora Core 1. I installed this on a dell latitude Cpi (266Mhz) WITH the GUI, and it ran well. The GUI option kind of depends on your RAM, the Cpi had 256M so it was okay. If you've only got 128, you can try it, but it may be a bit sluggish...
Personally, I'd wait on FC2. I just upgraded, only to find out there';s still some kinks to be worked out. Go with FC1, and wait until FC2 is in a little better shape.
Good luck!
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