Program / hardware Compatability (Net.)

My name is John, I having this problem:

I have two (Pentium II, 350MHz CPU, 64Mb 66MHz SDRAM) Computers,
running Windows 98 and have 6Gb Hard Disk Drive linked to a Backoffice PC
(Celeron 2200MHz CPU,128Mb SDRAM, 40GB Hard Disk Drive) running Windows XP
Professional. The backoffice shares 16 Bit Point of Sale program which runs on
peer-to-peers network. My problem is that this program runs smoothly on
Pentium III machines than in Pentium II. would you please advice me on whether to
upgrade my two Pentium II machine, since I believe windows 98 support 16 bit
programs and I set Windows XP is to run on FAT32.

Thank You
john (SA)