Win98 Guest OS has high utilization of the host CPU

I have a Win98 guest machine setup for a legacy application (DOS based), the application is run across the network by other Win 98 workstations. The problem is that the 98 guest easily consumes 100% of the host’s CPU when the legacy application is doing certain calculation intensive tasks. I know this is somewhat expected when calculating but on the old PII machine that was not the case, and the app ran way faster. The host machine is a new Dell Poweredge 840 Celeron CPU with 2 gigs of memory Windows 2003.

Could the Celeron CPU be the problem?  Any ideas?

Thanks

Clay