I'm experimenting (slowly) with my laptop with 128 meg. RAM and 400 MHz Celeron CPU. Xubuntu seemed OK at first, but then got as sluggish as XP, and it didn't really appeal to me anyhow.
Now have Puppy Linux on it; boots fast, shuts down almost instantly, and runs pretty well. Now if I can just get a wireless card working with it ...
I intend to take a look at Damn Small LInux, Gentoo and Slackware also.
When booting from pretty much any Linux CD you can partition/format. When I first installed Xubuntu I skipped the option to shrink the XP partition and just told it to use the whole hard drive. Installing Puppy I shrank the Xubuntu partition and set it up for dual boot. Messed up the last part and can't boot Xubuntu, but this is a learning experience for me.