This is tough for you. Editing HD is demanding on a older computer.
Your system is underpowered, sadly, for HD, and you could really do with 64 bit operating system, more RAM, and ideally an update to a 64 bit version of PPro (5 or later). You really need a fast second hard disc so you can keep your footage on it, away from your operating system A large fast Sata disc wouldn't set you back more than £50 / $80 or so ...
Vegas is a free download demo soCS you could see if it would cut HD in original format on your system: possible but not likely.
Or you could be thinking about transcoding to an easier format for editing: though you need to keep it compressed enough to run from a hard disc.
Canopus has an intermediate codec which is good - you'd then transcode the footage before editing. Edius from Canopus is a capable editor with a free trial version too.
In Premiere you might be thinking about transcoding to Cineform, but you'd have to pay for the codeec
http://techblog.cineform.com/?p=1855 and whether that's a good choice for you, when you really want to be updating your whole system, is your call.
Or of course you could transcode to DV, which your system would probably edit quite easily even without a second hard disc, and come back and redo it in HD later when you have a newer computer and software at your disposal ...
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