Terminal server

We have installed windows 2000 server on our server and are using it as a terminal server. The users that go on the servers have mostly computers that are pentium 75 mhz, 16 MB RAM with windows 95 as an operating system. So far the system is extremely slow and many times during the day, when a user is working his computer freezes or the session is terminated suddenly. Is there a reason for this? What can we do to solve this problem?
Thanks