1.2 G is relatively small by todays standards.
Make sure that the old memory and the new have the same speed rating. If you have mixed speeds, and the system accept it, you will use the slowest speed. It the old memory is slower, then removing it can make your system faster.
Do as Peccavi proposed.
Keep in mind that the task manager don't tell you everything. There are some process that NEVER show up. 100% is what is left after those processes have taken their CPU share. It's known as "Core Process", and in the task manager, if you check "Show core process time" in the performance tab, the red line show you that time. 100% is everything ABOVE that line.
Check how many process are running and how much memory they use.
Terminate those you don't use.
If you have more than one physical drive, move the paging file to the second drive and out of the system drive. Make sure that the destination drive is well defragmented before the move. It's all the beter if you place it on an empty drive or partition and give it about 2 GB minimal size, up to about 3 GB.
By default, Windows dynamicaly manage the paging file size, making it grow and shring and causing it to become fragmented and very slow to access. This in turn, slows down your system.
Then, if you can, try to install as much memory as your motherboard can support.
If it's launching applications and opening documents that is slow, then you probably need to defragment your drive(s).
A badly fragmented drive can realy make a fast computer appears slow.
Electro, April 2011