My main music machine is an XP Core 2 Duo with 3 gig ram and dedicated graphics. Is this considered a slow machine? Would like to use the smaller file format if possible but noticed warnings about old machines.

No, that is not a slower machine, you should be fine.

You can uncheck the box for "use +/- files" to check the performance before comitting.
If possible, always a good idea to have a backup copy of your realtracks before doing the erasing.

I agree with rharv. If you want to check first, just make sure the checkbox in Opt, Preferences, RealTracks is unchecked for "Use +/- RealTracks for Generation". If everything runs fine and the CPU% stays under 60%, you can safely erase the +/- files (but keep a backup).