You both missed it.
The OP has a shared GFX card, 8mb the MINIMUM and 128mb the MAX, when required.
Bottom line OP, SH3 requires a dedicated 3D accelerator card. System shared GFX cards in laptops ain't gonna cut it (guessing it's a laptop from the specs posted).
The only thing that 'might' help is to increase your Pagefile (virtual RAM) size. Set it to a fixed amount of 3052. TBH I'm surprised you even have shader 2.0 support.
Then again, this could be the bow spray bug in Stock.

Doubt it though.
Edit - How many resident programs do you have running, using up your limited 1015mb RAM? Using programs like EndItAll & FSAuto start which kill all un-needed programs might help.