Generic Windows drivers are never a good option, not back then and certainly not today. The generic drivers almost always are missing extensive amounts of functionality otherwise provided by the device when using vendor drivers. Some examples would be 2D/3D acceleration on graphics adapters and mixing options on sound chips.
The generic drivers tend to work well for hardware older than the Windows version, which incidentally tends to be less advanced (such as not being 3D-accelerated in the first place). For me, graphics drivers always had 2D acceleration and I never missed any sound functionality. However, vendor drivers are required for hardware
newer than the operating system for the reasons you mentioned. On the other hand, I've had stability issues with chipset drivers (and certainly video drivers), but not with Windows-provided drivers.
OP is complaining about poor video performance, and generic video drivers are one of the causes.
I read the original post as a system performance issue rather than a video performance issue. If it is video-related, then the issue is most likely to be graphics drivers. Note that DirectX did provide updated drivers as well (at least before version 7 or so).
Incorrect. Missing chipset drivers can have massive performance implications, especially on graphics adapters which may be on accelerated buses like AGP.
You are correct, but Pentium (586) systems never support AGP. It appeared first in 1997 - well past Windows 95 and, for most chipsets and devices, also past Windows 98. The same is true for most 3D accelerators. Therefore, as I stated from the beginning, vendor drivers are required.
My point is: The drivers shipped with Windows tend to be stable, well-tested and provide decent performance for hardware they were written for. Vendor drivers will take every possible shortcut if needed for higher performance or additional features. However, I personally don't see the point of stressing aging hardware unnecessarily - if I need more performance, I can simply use a faster system. Unless there is a severe misconfiguration or lack of support in the generic drivers, performance improvements tend to be in the single-digit percentages.
All that being said, I do understand your point. You are not wrong, just talking about
newer hardware.