Did you try elevating the priority of MC? You can do this in task manager. Try running MC "above normal" or "high" (NEVER realtime). With an elevated priority, and 2-5 second buffer, try playing tracks in "Direct Sound" and "Wave Out", like Matt said.
When you're DJing, you don't surf the Internet, do you? If not, then don't fret if surfing causes skipping. It shouldn't in the first place, but until we find the reason it's skipping, it's best to try simply to eliminate skipping during your gig.
With her machine's specs, elevating the priority of the task really should not be required
at all (Core Duo with gobs of RAM). That could come in handy if you're running lots of tasks simultaneously on a relatively wimpy machine, but it should NOT be needed for this system at all, pretty much regardless of background processes. Also, multi-tasking should not be an issue. I have no problems on much less powerful machines browsing the web via a wireless card and playing audio (FLAC, MP3, WAV, any of it) or playing Video back using MC.
On my, far less CPU powerful Athlon XP-M 2500+ with 2 GB of RAM, MC plays just fine when running Far Cry or UT2004 in the foreground with the default priorities! IE shouldn't be a problem, and if it is, you likely have some nasties in there (either spyware or hardware problems).
Since it happened before, and it's happening now with a new machine, it is absolutely, positively something that remained the same between the two systems. I'd guess:
1) Something set wrong in MC or an Audio driver. Was the new PC the same brand as the old one? What make/model was it? Have you checked for updated drivers? Also... If you completely uninstall MC and then install it from scratch, with a clean library, import some songs, and then try to play them without messing with any settings or installing any plugins or anything, does it still happen?
2) Spyware. I'd guess this is the most likely culprit. You may not realize that that cool screensaver or game or whatever comes with all kinds of nasties, but it did. If I were searching for problems on the machine, probably the first things I'd do would be to download and install BOTH
Lavasoft Adaware and
Spybot Search & Destroy. Run full scans with both of them and remove anything it finds, then reboot and scan again with both of them. You'd be surprised what actually comes pre-installed with many large PC vendors (I've found things fresh out of the box on first bootup on some of them - cough HP cough.)
3) Anti-Virus. Can you try uninstalling it completely? (Only do this if you can put it back on if/when it doesn't work). I agree.... What exact AV software are you using? What Firewall package? Any other "security stuff" installed?