3 things,
1, What format is your footage? MPEG2? MT2? If it’s uncommpressed footage it will never play smoothly.
2, Try doing anything that would cause you to render the footage, like add 1 click of contrast or brightness to it then render. Sometimes HD footage does play better after rendering.
3, You really should add more ram, as much as you can in fact, but you should at least have a total of 4GB for HD.
Let us know how that goes.