Windows 95 will run, but for an older computer I would put a light Linux distribution that will be a lot faster anyway. Almost no games will run except some that you can have on Linux (clone of the same game or almost ...) and most applications are now made for Windows XP by thinking like everyone has 512 MB of RAM ...
DistroWatch should be a good start and even if you have to learn a little, Linux will be the future, you just have to check the must-have applications topics to see that most of them are open source or at least Linux friendly (can be used on Wine at least).
Windows is now affraid of Linux and Mac OS X has made a part of their OS open source for that reason. Proprietary software now fight to survive and some of them turn the open source part to survive longer, but it is just bringing more help for the open source to grow, so Chrome will help Firefox to grow and VMware slowly goes down cause VirtualBox beat it ...
All this is mostly a good thing for the people, but it slowly kill the proprietary software.
Suggestion: Check for Damn Small Linux, Puppy, SliTaz ... (limited a little, but they are better than Windows 95 and virus free).