Hell, just blow the whole drive away, and use it for Linux only. Ubuntu is good, but may be too much for an old system. Debian (netInstall Method) is another good choice, and is not as graphic intensive by default as Ubuntu. I agree that you should try booting it with the Live CD and trying it out to make sure things work correctly.
Ubuntu/Debian Desktop installs take up about 2 gigs of space on a new install before updating. If it were mine I would delete all partitions, and start over with a Linux only system...but that's just me. I know some folks aren't comfortable doing things they do not know much about to a "working" computer.
I have an old Dell laptop with similar specs; 10gig drive, 384Meg Ram, Pentium II 366mhz. It ran Win2000 decently, but I stick to a bare bones Debian install with a lightweight window manager like openbox for desktop use. I used it as a backup server when rebuilding my main one.
Slackware might run pretty good, but takes more familiarization with Linux to handle any problems you might have. Some of the other LiveCD distros out there are: (DSL) Damn Small Linux, SLAX, KNOPPIX, Puppy Linux to name a few. All can be run from a CD without making any changes to your hard-drive...heck you don't even need a hard-drive in it.