Is that really Mandrake 6.1? Because if it really is, simply don't use it (but save the disk for historical purposes...). Thing is, that is really, really old. You will hardly be able to install anything new or get any support from that version.
Your hardware is old too. But still, new distributions as Debian and Slackware should work really well. If you want something a bit different, go with FreeBSD. Should work greatly with that machine. Don't use KDE or Gnome, they are too big, your harddrive is small and they need a hell lot of RAM to run acceptable. Fluxbox, Blackbox, Openbox, XFCE4 or WindowMaker are a better choice...
Well, I just wanted to express my views of old distributions. Things work really quick in the open source world
