You could give one of the cut down versions of windows 7 a shot ... you can find those online usually referred to as "lite" versions but if you wanna go down the linux route i would try mint it's pretty light weight yet bas all the standard features
Try lubuntu or xubuntu or debian if you know how to use it
I use arch 32 on a similar crappy netbook but you shouldn't use it if you don't already have experience with arch linux and don't feel like having to deal with the issues it has