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As a whole, painting programs tend to be more intuitive and more natural
for artists. In both Painter and Photoshop for example, the airbrush tool
behaves much like a real airbrush. With Painter, you have a multitude of
tools such as chalk, charcoal, watercolors, color pencil, etc. Chalk, for
example, interacts well with textured paper, as it brings out the grain.
Painter does have some capabilities both of Illustrator and Photoshop,
but I don't think it replaces either.
Photoshop is unrivaled for photo editing. You won't have much success on
the 16MB machines though. Color It! is much cheaper and can do many of
the basic things of photoshop.
If you're really looking cheap, look at the painting and drawing portions
of Claris Works. Being much more simpler, it is an excellent beginner