Hey all, I've finally gotten around to installing XP on my MAC (been trying not to) and I am noticing some rather nasty lag. Everyone is saying that speeds are near native, but I cannot run ANYTHING without tremendous amounts of lag. Even deleting a text file takes copious amounts of time. I am running 1940, tools are installed, and I have created a static disk which is now defragmented. I have 2GB of Ram, up to 1.5GB dedicated to the VM. What else can I do to optimize, or is there something seriously wrong here?
Set it for something in the order of 800 meg for Parallels, and 750 for the VM and you'll probably see a big speed increase. Play around to see how close you can set the VM memory to the Parallels total without slowing it down. Less is sometimes more. Even 512 meg for the VM might be enough (where enough is defined as a number such that increasing it doesn't increase performance).
You are probably starving OS/X for memory. Try setting Parallels for a maximum of 1GB of memory and set the VM to 512MB or 768MB of memory. Parallels is not an operating system. It is a program running on OS/X.
To the above good advice I would add this: On your Core Duo or Core 2 Duo, you actually have two processors running. In Parallels, one of the processors runs the guest operating system (e.g. Windows XP). The other processor runs Parallels itself, which handles all the interfaces between the virtual Input/Output and the real I/O on the Mac. So, as others have said, your Guest has plenty (too much) memory, and your Mac OS has too little memory to handle the I/O. One solution is to re-install with the recommended defaults.
No need to reinstall. Memory for Parallels as a whole can be changed in Parallels preferences, and memory for the individual VM can be changed in the VM console.
Joe and Murph's idea worked great. I checked my config in Parallels and then in the VM, and I was choking OS X. I had it set to max memory (1600) in Parallels, and was changing the settings of the VM. I kicked it down to 1024 in Parallels and 768 in the VM, and its working GREAT! Now I can run Visio and Robohelp very easily. Thanks for the help folks!