Do I have a capable PC?/Suggestions

[Helios]

Your clock speed is okay but that integrated GPU is very old, very Intel, and very slow.

While Dolphin doesn't need much from the GPU, that's really going to hurt you.

Xenoblade is also not an easy game to emulate. On top of that you're piling on an HD texture pack, making it harder.

Try using the latest development release, set the internal resolution to 1x/native.