I dont know if linux has any programs like audacity... But it does actually have
audacity. It can be a little finicky initially trying to get the sound piped
correctly into the program via the Jack server, but once that is done, you
should be right at home.

I personnally think your 700 MB or ram should be fine, but you may want to try
lubuntu if you are finding that things seem too slwo. Lubuntu is a separate
ubuntu installation that has a lighter window manager that is less resource
intense. But if you install Ubuntu and want to switch to the lighter package,
you can do that simply by installing the lighter window manager (no need to
reinstall the whole OS!). I was previously running the full ubuntu desktop on a
3GHz P-IV with 512 MB ram and there were no noticable problems . Also running
ubuntu on a 1GHz PIII with 384 MB ram, and that is very slow/performance
impacted.