Upgrade it to SP3. Then install IE8. Then enable automatic windows updates and install the first round of updates. After that, you can use IE8 to choose further updates. Most updates should be put in except for Search 4.0, Office compatibility pack, and Office validation pack. (these last 2 will kill windows update). After that's all done, there's a manual update to fix the ransomware bug that caused so much trouble last year.
It's also advisable to get whatever driver updates are still available for your hardware.
After all that, MAME should work perfectly well, depending on your CPU speed, amount of RAM, etc.