I use Eclipse with the Android Development Tools (ADT) plugin. This would by far be the most common path for Android app development.
I've got to say that Eclipse and the Android emulator together can pretty hefty in terms of memory. The greatest benefit to performance in my experience is RAM. I have 12GB of RAM on Mac OS X, but similarly novox77, it's overkill for Android development.
On Windows XP and Linux, you'll want at least 4GB. On Windows Vista and Windows 7, you'll want at least 6GB.