[WernherVonTrapp]

I don't see any reason why your system cannot handle SHIV and I'm inclined to believe that the issue is not with the game. I have a suggestion that, if you haven't already done this, it may help.

First: Right click on "My Computer"
and choose "Properties" at the bottom of the menu.
When the System Properties interface appears, click on the ":Advanced" tab. On the top section under "Performance", click on the "Settings" button. In the Performance interface, the "Visual Effect" tab should already be open. If not, click on it and choose the "Adjust for best performance" radio button. Then, while still in that window, click on "Advanced" and make sure both "Programs" radio buttons are selected. If not, select them, click "OK" on all windows until they're gone. Try running the game and see if there is any improvement.