I have been using a PC since last 3 years for normal use of mailing, surfing, word-processing, etc. without any problem.
The configuration is as follows.
Pentium P III 550 with 128 MB RAM in Win98SE machine with a 20GB HD. On board sound, DLink External Modem (even Internal will do), on board display.
NAV runs in the background and it hasn't slowed down my machine to any apparent effects.
Recently (6 months back) I took a Plextor CD-RW drive and even that is working fine with this. But I have to close all applications while burning a CD.
So I guess anything above this will do just fine for your needs.
You will have to check out your local market for buying such a machine. But I strongly recommend that you don't go for a 2nd hand one, unless of course your budget has some constraints.