HD Video Lag

I'm having a small problem with HD Videos. The videos are in MKV format, and I'm playing them on VLC media player. When I play the video, I get small bits of lag throughout the movie, it's not major lag or anything, and to some people maybe unnoticeable. But I notice it, and it's annoying. The lag usually occurs when a movie is at a part where the camera moves fairly slow, or when there is little action, ie. a person moving slowly.

The laptop I'm watching these movies on has the following specifications:
Dell Latitude D830
120 GB HDD 5400 RPM
2 GB RAM
Intel Core 2 Duo T7500 - 2.20GHz
NVIDIA Quadro NVS 140M
Windows XP Professional SP2


On a side note, I have followed the instructions here: http://forum.notebookreview.com/showthread.php?t=60416 to ensure my computer is configured for Duo Core Processing.

Thanks for any help in advance.