Maybe if I replaced 'it' with Linux you'd understand?
Linux was built on crap hardware? How did you come up with that, exactly?
What? Anyone can claim the kernel can run on 97 hardware, it's how well it runs with everything it brings. That isn't very fair saying you can take things out and disregard things from Linux when doing the test but Windows must be used with all the setting s maxed out. Something doesn't seem right.
It's not about running, it's about being useful. I'm not aware of anything Windows has done that would be useful on old hardware. Linux, on the other hand, is completely useable (as a server or moreso as a desktop) on old hardware.
And you're right, one of the big reasons is the interface. By default on most Linuxes that I've used, X-Windows isn't automatically started and everything can be done from a console. So let's just imagine we've done a full install and pressed the power button, and now we want to run a web server. I boot up, edit Apache's config file, and start it (which is what I did on darkside, that we're using now). It runs great. How would you do that on a Windows system?