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Ah.
Well, turning on all services except for Mail would be extremely taxing on a server. That's a lot of services to be running on a computer that's so underpowered. I'm going to go out on a limb and say you're experiencing a slowdown because you're running WAAAAAY too many services on that computer.
Try turning all services off except for iChat, File Sharing and Web Sharing. See if you notice any speedup after that.
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