I recently talked to my internet provider and they told me I have a 1.5-3.0mb service, which I thought can't be right. So I ran a few speed tests from various websites and they all say I have a 1948.4 Kbps connection. The problem is that for some reason when I download any files I usually cap at 150~200KBps. So what could be the problem?
1) 200 KB/s == 1600 KBaud. So you're not that far off.
2) Internet traffic has overhead. Every packet has a few bytes of IP and TCP headers.
3) There's two sides to every transfer.
There's nothing unusual about your situation.
Actually... there's a little more.
So they say 1.5-3.0 megabits per second. Doing math 3.0 / 8 * 1000 = 375 kilobytes per second, max.
XP needs configuring to ran as fast as it should, too. And sometimes you won't get full speed due to server not sending data fast enough. Multi-segmenting really helps here.
I'm assuming you download at 200 kilobytes per second and not 25.