MS's minimum sys reqs for XP are total BS. There is no way in hell you can run winXP on they 64megs of RAM they say in the minimum. 128 is pushing it. 256 is the sweet spot, IMO. Also, MS says you only need a P1, also BS. I'd say a P2 of at least 300Mhz. I ran XP on a 433 Celeron with 128megs of RAM and it dogged tho.
Overall, prolly the best all around best windows OS is win2k. Its more stable than Win9x, decent gaming support, and does not by 51% of your soul. Unless you have some older DOS apps you want to run, use win2k. WinXP handles DOS apps better than win2k. Also, you could dual boot win98 and win2k, if you wanted to run those DOS apps.