I recently installed Ubuntu for my dad, on an old laptop (his eyesight doesn't go well with new laptops with their resolutions, and LCD screens mostly look awful when not on native). It's a 1.6GHz P4, memory was upgraded to a gig though (256 was awful).
He had never used Linux before, and has been rather dismissive in the past, but he's liking it a lot now. He has called me a couple of times to go set up stuff, mostly initially for software recommendation, but overall he's finding his own way around the system.
Ubuntu runs just fine on the system, though I obviously left out stuff like compiz for desktop eyecandy, the laptop can't handle that.
It's fairly user friendly on the whole, since that computer isn't going to be your main, I don't see much of a reason to go with a XP dual boot. But if you do, install XP first.
Afraid I can't give much of an opinion on different distros, I started with Debian and as such Ubuntu was a breeze and likeable from the start, being based on Debian. I used some SUSE at college in Germany (I think that's the popular system there, or at least was), but liked Debian better at that time.