AE is not a realtime editor, though it is capable of importing many different file types it does not necessarily treat them as video, more like a bunch of colours and pixels. The data rate of the DivX is quite low which will help with playback.
Reduce the playback quality to 50% or use ram preveiw, this will mean some rendering is required.
You are right about the hardware, but if it works (however slowly) then fine just be patient.
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Edius Pro, ADVC300
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