Why does premiere perform so badly when it shouldn't?
Not sure if this was meant as rhetorical or not, but ..

I think your problem is the WMV. Premiere never works well with it. I don't know if its the way its encoded or what. Can you not capture in something more universal?

It looks like you're making minecraft videos, try using fraps or something that captures in avi or mp4. Those would probably give you better performance also if youre greenscreening, its better to used an uncompressed format.

Your video card could be an expensive, awesome gaming card but still not adobe-certified for gpu acceleration. Using one that is can help with this issue.

https://helpx.adobe.com/premiere-pro/system-requirements.html

Alex