I used anti-X Mepis 6 on my old dell 3500 laptop... its a PII400 with 256 ram and a 5 gig hard drive... the install was painless, it even setup the Linksys WPC54G ver.2 (the only Linux system I have played with that setup it without any headaches) It use Fluxbox as the WM, but there is now a Xfce version out (havent tried yet myself)
Here is the wiki page for more info...
http://antix.mepis.org/index.php/Main_Page
I have also run openSuSE on that system with now problems... DSL and PuppyLinux also worked wonderfully on that system
Hope this helps you...
Tim
1.8ghz Celeron Vaio openSuSE 10.3
2ghz OC Athlon 2600+ openSuSE 10.3 Alpha
Dell Dimension 3500 PII 400 anti-X Mepis 6