hi angel--couple of ideas:
-Did you download the Macintosh no VM* installer?
If so, select the LW app in the Finder and use the File-> Get Info, and see what the preferred memory size is (give LW at least 60 MB of memory). You can also search your hard drive for Apple Applet Launcher and give that 60 MB's too.

If you can get LW running, go to Tools->Options->Speed and check the "Disable Ultrapeer" box--that will cut down on the number of your connections from ~64 to 4. This might be what your computer is having trouble handling. You'll still be able to search, download and upload as good as before.

(Virtual memory is when part of your hard drive is set up to be used like memory, but it's really slow in comparison to the real stuff. Each connection needs memory. So, if a program is expecting a quick answer and it's stored in virtual memory, it's like the difference between getting the answer by phone or mail. Not good for emergencies! Google will give you much better answers)

Cheers--sorry for the length.