I think the above poster has hit the nail on the head...
Reason i say this is that a friend has a total loss of performance when they upgraded the R.A.M... This was due to the fact the M/B only supported 2 X 512 and they put 1 x 1G in and it just didnt work right...
Same would also happen if you use the wrong type of R.A.M...
If its buffering AVI's then its got to be a ram or graphics problem, i cant see its been temp files or the system, unless you have something pretty chuncky running in the background and hogging the CPU...
You could check in "system" to make sure Windows can see the RAM in its full size, if it cant, could be a faulty stick of ram... But remember, 1gig ram will be less as the computer will take x ram away for graphics unless the system has a dedicated graphics card...