Maybe a stupid question, but have you made sure your video drivers are up to date? It's been years since I used SDL, but IIRC it uses OpenGL on the backend, so if your GL drivers are still Microsoft bundled or otherwise non-accelerated, then OpenGL is going to be sloooow.
Actually, SDL 2.0 I believe is heavily attached to OpenGL, but with SDL 1.2 I think it's only true OpenGL code that benefits from hardware acceleration. I could be wrong though, I don't know if initializing the screen with SDL_OPENGL can be done without OpenGL specific code, but he could try adding that to the flags when calling SDL_SetVideoMode().
Don't know for sure though, just something to look into.