My inclination, with a machine of that age and specification, would be to stick with XP. If you can get hold of a "used" Certificate of Authenticity for WIN7 (around £40 on e-bay) then that might be worth a punt, but £100 or thereabouts for WIN8, no chance!
BTW, with only 2GB RAM, I would stick to a 32-bit version of the O/S. I only go 64-bit if the machine has over 3GB RAM. You may even find that the COA on e-bay may have come from a Dell PC!
Your PC is easily capable of running either Windows 8 or Windows 7.
I would advice you to upgrade to Windows 7 (not
.
No advantages, really, to Win8 unless you have a touch-screen (which you don't), quite the reverse, if you don't - it's a bit of a ruddy nuisance.
XP has always been my preferred OS but, since MS stopped their Service Upgrades, it is becoming a nightmare. More security holes in it than a Swiss-Cheese. And it is being attacked, accordingly, by the "Bad-Guys".
I have a network of 6 PC's. 4 used to be XP (with one Win7 and one Win8 (but I always used XP for my work, the 7 and 8 machines being purely for investigative purposes, with regard to client problems) - (I'm a computer technician since 1982). Now, 4 on my network are Win7, one Win8 and only 1 WinXP (further, I will not allow the XP machine Internet access. Sad but true). To allow it Internet access would be like sending the British Tommy's over the trenches like a line of dominoes, as in WW1, to face the Hun's machine-gun nests.
Replace your XP with Win7.......
NOW!!!
(otherwise you will just end up paying someone like me to sort it out for you and we are not cheap).
Why do I offer this advice, which is counter to my interests?
1) You are not in my jursidiction and there exists no "Brotherhood" of IT Technicians.
2) If you are "normal", you will either ignore the advice or keep putting it off "until tomorrow" and end up in the mire, in any case.
Do it.
Hope that helps you. A Windows 7 upgrade is cheaper than a new PC (of your specifications. It's a good machine).
I would agree with an earlier poster in that you should stick with the 32Bit version, due to your RAM (Win7 32Bit runs fine on 1Gb for most stuff so your 2Gb should be more than fine. If you are a serious Gamer, it's probably not enough....But if you were a serious Gamer, you would be advising me, not the other way around).
Best intentions in my reply as I just received stellar advice from some guys in the Auto section and like this site with its pooled experiences aimed at helping out each other.
If you need any further help, please ask.
Best wishes.
Jib.