When you create your movie, choose save to hard disk. In the choices to save
the file, it will ask what type of file, avi, or wmv.
You can do either one and it should process and compile (render) all the
transitions and effects into the file at once. That way when you just select
the file to play it in media player or by adding it to the movie maker video
collections as a new clip,and playing it in the preview monitor, it shouldn't
have to do a lot of rendering (processing effects and transitions in the
background).
Just to confirm it, you could also save your current project as a new name,
duplicating it. Then in the new copy, take out all the transitions and
effects, then try playing the file. If it doesn't hang up as you described,
it should confirm the problem. Then just begin adding an effect or transition
or two and replay until it hangs up again. Then you will have an idea of how
much you PC will handle, and know to do your projects in smaller pieces
(clips) and combine those into your final version.