HOW TO CONFIGURE PAGING FILE

By Default the paging file is set at 1.5 times the total amount of memory,to change see below

How to Move the Paging File
Log on to the computer as Administrator.
Click Start, and then click Control Panel.
Click Performance and Maintenance, and then click System.
Click the Advanced tab, and then under Performance, click Settings.
Click the Advanced tab, and then under Virtual memory, click Change.
In the Drive [Volume Label] list, click a drive other than the one on which Windows is installed (Windows is usually installed on the drive C). Under Total paging file size for all drives, note the value that is displayed next to Recommended.
Click Custom size, and then type the recommended value in the Initial size (MB) box.
Type the maximum size that you want to allow for paging in the Maximum size (MB) box, and then click Set.
In the Drive [Volume Label] box, click the drive on which Windows is installed (usually the drive C), and then use one of the following steps:
If you do not want a paging file on the drive, click No paging file, and then click Set. A message similar to the following message appears:
If the pagefile on volume C: has an initial size of less than 126 megabytes, then the system may not be able to create a debugging information file if a STOP error occurs.
Continue anyway?

Click Yes.

If you want to keep the minimum size of the paging file on the drive, click Custom size, and then type a value that is equal to or greater than the amount of RAM in the computer in the Initial size (MB) box. Type that same value in the Maximum size (MB) box, and then click Set.
The following message appears:
The changes you have made require you to restart your computer before they can take effect.

Here is a website with some pictures and a good explanation of the process, along with some tips.

http://www.blackviper.com/AskBV/XP17.htm

If you do not have a second HD, you should let XP manage VM/paging file itself. Limiting it, or making it too small/large, will hang the machine big time. If it was me, I would get a second HD and let XP use that HD as the paging file.