It could be your drivers. Though on the other hand, maybe your AGP Aperture is set too high. I have 1GB of RAM, AMD Athlon XP 2400, and an ATI Radeon 9600 (128mb) and I can run Episode One and Half-Life 2 with high settings smoothly.
It's also quite important to note, that 7300 SE card series, while supporting all new technologies, lack in computing power. They have about only four rendering pipelines and similar ammounts of pixel and vertex shader units. Memory frequency isn't as good as in some top 6600 models too, for example. Finally memory bandwidth is around 5 GB/s, which slows down thigns a bit.
But let's put the pesimism away, try updating all of your drivers first, and then eventually lower the resolution.
Yeah, Pvt. Allen tells the truth GeForce 7300's are not highly known even though it is a 7000 card. Same applies to my 9600 in ways. Most video cards can run Half-Life 2 at 1024x768 just because that is the default resolution for that game. If you have an AGP motherboard ATI X800s or GeForce 7800s and maybe 6800s are recommended.
I don't think there is any default resolution for Half-Life 2, such thing would cause minor troubles for widescreen displayes, which are seemingly promoted by Valve on every trailer (sadly I noticed that just after I bought new standard aspect monitor). Everything is most likely adjusted to your hardware capabilities.
I guess I meant most machines can run at 1024x768 without problems on HL2. For example, Call of Duty 2, it is a pain for me to run at 1024x768 while in Far Cry 1024x768 runs quite smoothly.
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Half-Life 2 General Yib-Yab (Off Topic) 
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