Can't comment on general Linux compatibility of Gateways (try this site - http://www.linux-on-laptops.com/
The big problem with those specs is the amount of RAM. The latest GNOME desktop (default for Fedora) won't be happy with less than 128 Mb RAM, and the latest KDE (default for most other distributions) is probably the same, so you would need to use a light-weight graphical environment like IceWM or XFCE and avoid heavy applications like Mozilla and OpenOffice.org. So getting a fully featured graphical setup on this would be a challenge rather than a really practical solution. Given the age of the machine, sourcing more RAM could be difficult and probably not cost effective.
FWIW, my solution for a Linux laptop was to buy a refurbished ex-corporate machine from one of several firms that specialise in this kind of business - these days you can pick up something like a brand-name P3 700MHz with 128Mb RAM and DVD for the same price as a bargain basement desktop. If you go this route then check the Website above for