Until a few weeks ago I played with an Athlon XP 2000+ with a GeForce 4200 Ti card and 512 Mb Ram. It worked, but not overly well so. When encountering heavy traffic like with Rubinis Traffic Mod or a large convoy FPS sank below 15 FPS making the aiming a game of chance. In addition the FPS lag in time compression made playing above 512 practically impossible. I was playing at lowest quality possible. Vsync and AA (antialising) off, mipmaps and allow other stuff toned to lowest settings.
I then tried to upgrade the video card (6600GT), and it gave me some more FPS in traffic and convoy. I could even switch on AA and some other stuff. The addon memory I also purchased decreased the loading times somewhat, but in my opinion had the least effect on game play. I then got lucky and stumbled upon a new Athlon XP 3000+ FBS266 and a very affordable Asus board, so I decided to invest and sell the old parts.
As with the graphics card, this gave me a big boost. The best thing about it was the fact, that I could now play in 2048 TC and still be at 60 FPS. Frame rates even in very densly populated harbors normally do not fall below 30 and I have no problems with large convoys whatsoever.
From my understanding I would say that all the ships movements in TC are calculated by the CPU and thus with an Athlon 1.3 you're massivly too low for that, since my XP 2000+ didn't really manage to cope with that. (and I remember my last upgrade from an Athlon 1400 to have been a major advancement in gameplay already.) A better graphics card may help you a little when it comes to graphics, but ultimately I'd not expect too much of that.
If you're lucky and can get yourself an "old" Athlon XP 3000+ or even 3200+ and a cheap but quality Socket A board for it and can afford a nice graphics card it will suffice for quite a while, but like myself you would be standing at the same point in one to two years with the next game that won't run properly
.