For someone who knows a lot about computers, you seem clueless what the power settings actually do.
At its most basic configuration, it only affects timings and availability of hardware. As mention, it allows for HDD idle timeouts, even going as far as putting your computer to sleep if set to do so. With desktops, this is pretty much all it does which is why the power saving option is usually hidden by default.
With laptops, it's usually tweaked by the manufacturer to include CPU idle speeds and adds a percentage of over/under-clocking. Certain tasks can also be configured to be reduced to a lower priority (e.g. System backups or virus scans) or be restricted when certain power profiles are in place. It all depends how far it's been tweaked and reconfigured.
Now this doesn't seem to be your case since yours is a desktop with the most budget of parts, but it does make me wonder. What brand desktop is it? HP? Acer? Compaq? It's possible that they tweaked the settings to make it easier on the weak PSU that would come with it, but those specs sound more like "Vista ready" than "designed for Windows 7".
EDIT: ok, reread the op again, and noticed it's Vista. Makes a lot more sense now. Go ahead and install Windows 7 since you have it, and do a clean install. That will clean off the random apps and settings that are giving you problems and might even make your system feel slightly faster. Remember to backup whatever files you need before you start. With Windows 7, you won't see this proble, come up again unless you change something you're not supposed to.
Now that the advice is out of the way, I've earned the right to criticise. People who want help usually aren't lazy enough to screw up their grammar so bad that it makes it hard for potential helpers to understand what it is that has gone wrong. I would have relied earlier, but the effort required to decipher the OP made me turn straight to the other tab with manga on it. Fortunately Supr made it easier for me.
