I don't think you will have any problem installing FC-3 if you put in a new disk. 192MB RAM is plenty for this purpose.
Also I didn't notice FC-3 was any slower than FC-2; Has someone said it is?
I'm running FC-3 now on a Sony C1VFK Picturebook with 128MB RAM. (It used to have 256MB, but the extra memory has failed.) This has a Crusoe 660MHz processor.
I'm also running FC-3 on a 300MHz Pentium II desktop with 128MB RAM. I had no problem installing FC-3, but I must admit X is rather slow.
Both machines have plenty of disk-space. (I installed a 60GB drive in my Picturebook.)
I don't know if FC3 is slower than FC-2 but they are both pretty slow on a 128M RAM machine. X is certainly slow. But how about Open Office, and firefox speed of opening. etc, etc, and so forth. The swapping alone can torment you endlessly.