Why does my 386 with a 486 cpu run slow?

Because real mode DOS programs may do direct hardware access or perform segment arithmetic, both incompatible with protected mode, an operating system (OS) is limited in its ability to run these applications as processes. To overcome these difficulties, Intel introduced the 80386 with virtual 8086 mode. While still subject to paging, it uses real mode to form linear addresses and allows the OS to trap both I/O and memory access. By design, protected mode programs do not assume a relation between selector values and physical addresses.