I won't duplicate articles about placing the swapfile far away from ready access as you have done. The additional seek to the other partition will likely add some time but this is your choice on that matter.
There is however the issues of:
1. Indexing Service.
2. XP's DMA 'bug'.
For item 1 I have yet to see it pay off so I disable the indexing the moment I get a new machine. Your choice on that matter if you feel its needed or not.
For item 2, the workaround is simple. Set the DMA on all channels to PIO, OK your way out then go back in and set it to DMA. The bug in this is that XP may display it as in DMA mode but underneath be in PIO (slow) mode. Again, the procedure is simple, but is your choice to flip it to PIO and back to DMA. Here's the article on where this setting is -> http://www.microsoft.com/whdc/device/storage/IDE-DMA.mspx
I have recently defragmented the drive and moved the virtual memory across the partition on my Vaio laptop.
After doing the above I noticed significant slowing in the processing and Task Manager shows CPU fluctuating between 50 and 70% with no programs running.
Indexing service is taking only 15k.
The next morning's AVG scan found a virus, Adware Generic.bxl, embedded in svchost.exe and healed it. Subsequent scans by Spybot S&D and Ad-Aware found and removed additional non-desirables ,but my CPU continued to run near full bore.
I have now run Stinger and Cleaner Professional with no new undesirables found and no improvement in performance.
I run XP with service pack 2 on a Vaio laptop with a pentium chip and 512 RAM.
Anyone have any ideas?