here is what i would do.
go into the page file settings, and set it for 0 page file. (there's a box to disable it)
you will need to reboot, make sure the pagefile is gone.
then, defrag the hard disk that the page file was on.
then, enable a custom page file with a 768 meg minumum, and set your max to at least 1024, preferrably, no maximum.
this will force windows to create a 768 meg space on the hard disk that is not made up of fragments. because of this, the hard drive will end up doing significantly less work, and at the same time, your computer will be able to resize the page file if needed..
(although, with 512 megs ram, you might try running the game with 0 page file)
keep in mind that although more and more components are being built for "gaming" the computer's main purpose in life is not to play a particular game, you may need to change some settings each time you play certain games.
and, there is a few misnomers about page files.
although the common conception is that you need 1.5x your ram, there is more to it that that.
different applications might need more than your ram+1.5x your ram. at this point, the computer is going to want to resize the file.
but as a minimum size, your machine shouldn't need more than 1.5x your ram, with a maximum of whatever it takes to run your games. (you are going to need to experiment a little to find what each game needs, it isn't just written.)
also, for what it's worth, bloodlines runs perfectly smooth on my machine with no swap file, yet lags a little if i use a swap file, no matter how i had it set, or even if the swap file was on it's own hard disk.
so in my experiences, all the lag this game tosses at you is related 100% to the swap file, and the fact that it even has one seems to be a problem.
my machine is also nothing like yours, mine sucks.