I've used Altbinz for a couple of years now on a Dell Inspiron 6000 with 1G RAM. Pretty old school by modern standards, I suppose!
When I ran it under XP, the decoding usually caused a bit of a bottleneck compared to my connection (20Mb via Virgin to Astraweb), but it wasn't really a big deal. There was a big improvement in the decoding speed with one of the versions back which helped a lot.
When I switched to Linux I was pleased to see that altbinz ran pretty swiftly under WINE - I was expecting it to crawl along.
Over the last few versions I have noticed problems with lag in the interface. Everything seems to be downloading at the expected speed, but the speed indicator does not refresh whilst downloading is in progress and the lag when attempting to switch tabs, pause etc is very slow as the OP points out. I don't think I ever had this happen when running altbinz under XP.
It's only a minor annoyance really. What I've got in the habit of doing is ensuring the connection is off, and all the downloads are saved as paused. Once I'm happy with this batch of downloads I unpause them, connect and just leave it to do it's stuff. It would be nice to search or add something whilst the other downloads are in progress, but I've got used to working around it.
Also, I don't think that the problem is hardware performace related, as I've run altbinz on an eeepc701 reasonably well.