Some people do find LW is resource hungry on their particular systems. But then 2 identical computers bought at the same time from the same shop can behave quite differently.
1. May I suggest you try updating your Java. If you are willing to, install the Java 1.6 beta which has had good reviews. However, LW will not use it if there's earlier versions of Java on your computer so you'd need to remove those 1st.
http://java.sun.com/javase/6/download.jsp JRE "Offline" version which is a 15.72 MB download.
2. Do install the newer version of LW because it's suppose to use slightly less resources. If necessary, keep a backup of your previous version.
3. If you're sharing a large no. of files (eg: more than 2,000), perhaps try reducing that number to see if it helps with the running of LW.
4. If you have many, many incomplete files, you might be better to delete those that are zero % or less than 50 KB. This can greatly reduce the resources LW uses.
Tip: Purge the Downloads Queue! (this description is by a mac user but same principle applies.)
5. Personally, I preview files via the incomplete folder, not via the download window. This means no Preview files are created in the incomplete folder. These can take up considerable space if not deleted. So instead, I go to the Library window, click on the incomplete folder, select the incomplete file & press Launch. I use
VLC - (click on link) player for this purpose. I often recommend VLC because it has in-built codecs & is generally very reliable. It also can play most audio format, dvds, vcd's, audio & video streaming, etc.