Does Linksys slow down XP?

All the router installation did was configure your settings. It does not use any system resources. I suspect you have other problems taxing your resources and it is just a coincidence that this happened at the same time of your Linksys installation. Try running your spyware scanners and anti-virus scanner to rule out a virus and/or spyware.

If that did not resolve your issue, then try performing a clean boot of your XP installation: