RAM also has a lot to do with it. I have a 32mb Mobility Radeon 7500 (terribly obsolete graphics card) in a 667mhz (well, a mac, so actually about 1ghz equivalent to a PC), originally with only 512mb ram and I had some lag everywhere I went. I now have a gig of ram in the machine, and I only experience significant lag on a busy day in Hydlaa Plaza. I have yet to go to the waterfall at the Bronze Doors though; I bet I would also experience lag there.
Xirius