Norton Online Backup Freezes PC, Nobuagent.exe causes High CPU Usage 100%

Have installed the paid version of  Norton Online Backup v2.0 (25gb) on Desktop (AMD Athlon 64 3000+, 2 GB RAM, Free space on system partition 6 GB, OS: XP Home SP3).

 

The Norton Online backup ran with normal performance the first time. It backed up 3.57 GB successfully. Its subsequent scans or backups don't seem to complete. As soon as the Norton Online Backup is automatically or manually started, the computer becomes extremely slow and comes to a standstill. If the backup is cancelled, the computer starts operating normally. During Backup, it is very difficult to logon into Norton Online backup, as the browser takes ages to start or even the Windows taskmanager.

 

The CPU usage shoots up to 100%, as the NOBuagent.exe consumes nearly 80-90% of the CPU usage as soon as the backup starts. NOBuagent.exe comes to zero or very low, once the backup is cancelled and computer starts functioning normally. The NOBuagent seems to be scanning the entire drive or select folders but with no progress, it seems to hang or crawling. 

 

Tried changing the performance speed bar in "Other" setting, but this doesn't seem to help.

 

Norton Online Backup has become unusable!!!!   Kindly help and sort out the issue.

 

Are there any minimum free space requirements for Norton Online Backup for the drive it is backing up?

 

Note: The same machine runs Symantec Backup Exec System Recovery 2010 Desktop edition regularly, there is no major drop in performance with the same. Other software: NIS 2010