Meh, even fullscreen 360p Hulu might be difficult. I remember having fairly high CPU usage on a Pentium E2160 1.8 GHz Allendale and I don't think it was doable on a Celeron 430 1.8 GHz Conroe-L and I believe both are faster than your CPU.
Maybe I'll have to commandeer the PC I gave to my Uncle a while back:
Athlon XP 3200+
3GB RAM (DDR 400 / Dual Channel)
.... But - it's fairly loud because of the crappy Turbo Jet cooler I put on the CPU. (lol)
However... Streaming a 480p movie from another machine in the house (using MPC-HC) had no issues in full screen.
Haven't tried a 720p movie but I'm about to!