You might be able to run X (needed for graphics), but the fancy window managers like KDE and Gnome are not an option on that machine. I have Mandrake 8.2 on a P2-233 with 96 MB and KDE uses a lot of RAM and is a little sluggish.
You do have a couple of options. Less intensive window managers are available (IceWM, etc) and those might be alright... And like NorthenLove said, you can run the system as a server in text mode and use browser-based administration (Webmin) from your main system.