http://www.skyrimnexus.com/downloads/file.php?id=4 mod fixed my freezing/slowdown.

I am NOT a Windows XP user, but I was having the same freezing and slowdown problem described in http://www.gamesas.com/index.php?/topic/1269088-2-7-second-freezes-outdoors/. This issue occurs when you change cells, which you'll notice most often when traveling outdoors. In my case it was massive slowdown (not FPS drops, but the entire game slowed) and sometimes a freeze. Sometimes it cleared up on its own; sometimes only changing cells got rid of it.

My specs:

• Windows 7 64-bit
  
• i7 930 quad-core @ 3.2GHz
  
• Radeon 5850 / 11.10 driver

I played 10~ hours with the http://www.skyrimnexus.com/downloads/file.php?id=4 yesterday and the game ran completely smoothly. It also reduced CTDs (just 1 in a 10-hour session, compared to 1 approximately every hour in fullscreen mode).

If you're having these problems, try the windowed mode mod and see if it works for you. Again, I do NOT run WinXP, so it may not work if there's an XP-specific issue.