JFS is pretty damn old[1] as is ext2.
> I'm not sure what kind of '166' you have. But you're probably running at least a modern webbrowser as IE 4 is no longer suitable in this day & age. Most sites didn't even use https.
I'm not sure what sort of impression you got about me, but maybe I should clear things up a little; I was also around for the 90's. I know what the general software situation was, and (unlike most) my impressions aren't buried in 30 years of memory haze and nostalgia either, since I still use such software on occasion. The computer in question is a Compaq Presario from ~1996; it's been upgraded with a 233MHz Pentium MMX that's currently clocked down to 166MHz for... reasons. I've maxed out the RAM at 128MB, about half of which is required to get X up and running on any unix release from this century (win95 fares excellently, win2k is pushing it though).
No, it doesn't run a modern web browser. There's no way in hell you'd get one to run on that hardware. The best you can really do is something like Dillo, or D+, depending on platform (or go text-only). Whether or not I run "modern" software on it, really depends on what that software is. A lot of old tools work just fine, while some modern tools are still somewhat lightweight. It really depends.
I have no experience with FDE on windows. The closest comparison I could draw would be to the built in disk compression utility, which I do seem to recall having a speed impact. I'm not saying it wasn't usable; I'm just saying, from my experience with the hardware of that era, running software of the era, I'm surprised to hear that it could give a reasonable experience. As you say, software was much lighter; meaning, there are many things we do today, that you just didn't do back then --- such as making a full pass over the datastream in your filesystem code.
[1] https://en.wikipedia.org/wiki/JFS_(file_system)