I would back up your data to an external HD or burn it and then perform a clean install from the restore CD if you still have it. See if the system runs nice and fast when back to original factory build. Then perform updates and keep track of performance. You might find as I did that the jump from SP2 to SP3 is when you see a big dip in performance.
I ended up rebuilding mine and keeping it at SP2. ( Although running in SP2 mode, made this system vulnerable to hacks etc, so I never used it for banking etc.)
I had an Athlon 64 not that long ago and had to retire it because it was becoming painfully slow and unable to play the games I wanted to play with it. I did get some better performance by installing an AGP Video Card into the available expansion slot so that of the 1GB Ram I had similar to yours 2x512mb sticks, that the onboard video would shut off and so the shared memory would go back to the system to use. But the 8x AGP GeForce 6200 with 256MB Video Ram only bought about another year of use out of the system until the game I play the most WoW with Cataclysm Expansion would crawl at 6 frames per second. My OS was XP Pro SP2 since SP3 brought the browser and system to a crawl at 1GB Ram. I also was using the microsoft security essentials antivirus which is free and not a resource hog like Norton and McAfee.
Also your HD size appears to be a typo... thinking maybe its 250GB and not 2.5 TB. My system I had a 300GB SATA drive in it, but it was the old SATA which is 1.5gbps instead of 3.0 gbps. The origian drive my Compaq Presario came with was 80GB IDE, but the motherboard had two SATA 1.5 connectors, so I upgraded for better performance.
