I would never put the pagefile on an external disk.
USB attachment precludes DMA, thereby slowing down data transfer and also significantly increasing the load on the CPU.
Theoretical max on USB 2 is 480 Mbps = 60 MB/s. Theoretical max for UDMA mode 4 / Ultra ATA 100 is 100 MB/s, mode 5 = Ultra ATA 133 is 133 MB/s.
While UDMA 4 and 5 both comfortably exceed the rate at which the fastest drives can read data off their platters (around 80 MB/s), it is better to eliminate the bottleneck!
So a dedicated INTERNAL disk is the only way to improve
performance.
Of course buying so much RAM that the pagefile is redundant is another option! But Win XP can only address 4GB - and by no means all mobos can accomodate that much.
SD