I had an old cruddy laptop laying around that I never used. I was always trying to find a use for it, too. Then I read an article in Computer Power User about creating a picture frame out of an old laptop. I decided to give it a go. Turns out it's not too tough....
The specs on my old laptop are: 15" screen running at 1024x768, PIII 450, 512 MB RAM, 12 GB hard drive. It was once a good machine but now it's pretty much a slug. So I first loaded it up with software: I installed a fresh copy of Windows XP Service Pack 2, and removed all the unnecessary garbage like Automatic Updates, prompts to upgrade security settings, etc. Then, I found a slideshow program that would generate an executable slideshow file and I put a shortcut to it in my Startup folder.