Do you use Virtual Memory at all? I notice you don't have heaps of RAM. The advantage of VM is the extra memory. The disadvantage is the slowness it causes. As instead of using RAM, it uses the extra memory from storing it on the HDD. So the system and programs using it tend to slow down a bit depending upon how much VM you use. If you have a 2nd drive, put LW on there instead. Running programs from alternate drives/partitions improves their performance.

As for Program memory allocation, when I first used LW, I varied it depending upon how many incompletes and shares I had. Sometimes giving it too much actually seemed to make it a little unstable. But then, back then the Java I was using was even older & I had java issues.

I can also say that sometimes one version of LW worked better than another. I may have another LW 4.0.x version hidden away somewhere. Such as 4.0.4 or 4.0.7 On this particular computer, on OS 9, I initially found the earlier version worked better than 4.0.10 & also basic seemed to work better than pro lol. But those problems seemed to get sorted out.

Try this ... make sure LW is closed. Then go to the Preferences folder & delete the LW prefs folder. If you put the folder into list mode for viewing, you will find it at the top of the folder.
It is located here: Macintosh HD/System Folder/Preferences/.limewire

Next time you open LW you will need to reset all your options again.