Well Hardware Transform or Lighting or T&L is a technology implemented into the graphics card which when used will calculate all the transformations ie(moving, resizing rotating 3D models in virtual space) and lighting (lights and shading) in hardware on the GPU and will keep the CPU free for other tasks.
End result more frames per second in games.
NVidia TNT2 series including TNT2 M64 is not capable of this that is why it will not run most of the games today.
T&L starts from the Geforce2 series. eg. Geforce2 MX200, Geforce2 MX400 but these cards are also not recommended.
Go for atleast Geforce4 MX440 at around 2.5 k
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AMD Athlon64 2800+, MSI K8N Neo3(NForce4), 1GB Kingston DDR400, MSI Geforce 7600GT PCIe, Viewsonic VA702b 17" LCD, Creative SB Live! 5.1, Logitech Z-5300 5.1 THX Speakers, Seagate 200GB SATA HDD
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agp card
And with more prices falling and getting Fx series ot Ati series card will be better option....
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