The chokepoint here would be the networking and RAM. Pi-hole isnt all that resource intensive but does use a bit of the network resources. Kodi, should run along with it but the performace as stated from other posters will leave a lot to be desired. The 2GB of RAM is not going to be powerful enough to do a lot. On the fly encoding for video is going to suffer by RAM, CPU and network output. Its possible to do it but youll definitely have to be patient with it.
Your drive. Get a new one, like today, get your info off that old drive and replace it.