yes, that is not a really old pc
you can run on it anything but kde4
gnome, e17, xfce or lxde are good options apart form openbox
Everything is relative - where I am you would be hard pressed to find anything that old. They just get junked. I recently fished four 2.6ghz P4s out of a rubbish skip, plus CRT monitors. One of which is now my main test 'puter with three versions of PCLinuxOS installed on a 40gb drive, plus space for another if needs be. The other two - who knows, one may wind up being my main machine! The forth one I set up for a friend with the installed Windows intact, but with Puppy linux on a stick and PCLinuxOS on disc. I should be hearing back from him soon!
The fifth computer I fished out of that skip was a 450mhz P3, with 128mb of RAM. I scavenged the hard drive and junked the rest. No way in a pink fit I will be able to find a home for it anywhere around here. Plus most of the bits don't translate to P4. Breaks my heart to do it, but that is the reality.
I also find that the older the hardware, then the lighter the OS. OB has the edge because it doesn't push the extra desktop layer. On a P3 that makes all the difference. On a screaming duo-core it makes it super fast. I'd put OB on a supercomputer if I had one - all the same apps run on it, why waste cpu power on the system?
I guess what it boils down to is what you want to see on the screen. Some people like lots of bling - icons, panels, widgets, and so on. Some of us want to see nothing! I started using conky so I could tell whether my computer was on or not! Then I figured wallpaper might help. And that's it. Nothing more. Each to their own, but on light weight hardware I would definitely go the lightest system.