... and noticed that his original installation discs offered an option to install just the bundled software instead of the whole OS. I would imagine this would allow you to reinstall your original iLife software (if it had become corrupted somehow).
Warning !!! I do not know if this option allows you to archive your original songs, photos, movies built in iMove, etc. Consequently, if you try this option, you might want to make complete backups of all your photos, songs, etc.
That being said... I googled to see if there was reports of poor performance using RAW images in iLife '06 iPhoto. I found nothing indicating there was some common complaint... consequently, the first thing that comes to my mind is the software may have become buggy. However, I don't shoot RAW so I have no personal experience with any potential problems. Maybe you have so many RAW images that the new iLife '08 may offer you better performance? Or maybe it is time for you to try out Aperture, which by all I have read, is the ideal mac application for managing RAW images (I sound like an advertisement there but - sad to say - apple did not pay me to write that).
Anyway, someone may have better advice than me. I'm assuming that you have repaired permissions on a regular basis, so the only thing I could think of was maybe your software has become slightly corrupted. Reinstallation may tweak it back to a faster performance.