Indys weren't truly that slow. The problem was the base models were memory constrained to the point where IRIX could barely boot. 16MB was not enough, and IRIX 5.x had memory leaks that made it even worse. An Indy with 96MB+ will run IRIX 6.5 pretty well.
That sounds right. I believe most or all developers at the place I worked had either 32 or 64 MB in their machines. At first (~1995) most were probably using IRIX 5.3, but by 96 or 97 I think most if not all had moved to 6.5.
Whatever I had, I don't recall lack of memory ever being a problem. And the GUI was quite snappy.
The GUI was fantastic. Minimal got out of your way as much as possible and used the hardware acceleration to great effect. IRIX 6.5 was rock solid, I used it as my main driver for years before switching to Linux, we also had some windows boxes floating around because we supported a windows binary but that and admin were the only things done on those, everything was either SGI or Linux. I was still using my SGI keyboard two years ago but it finally died.
SGI some places did a great job at giving good deals to computer labs. When I was at university in Oslo, there were rows and rows of Indy's on one side of the biggest undergrad computer lab, and then a bunch of Suns with multiple monochrome Tandberg terminals hooked up on the other.
No big surprise that the Indy side always filled up first, and that "everyone" soon had XEarth and similar running as backgrounds on the Indys... Of course "everyone" loved SGI and were thoroughly unimpressed with Sun after a semester in those labs.
Still, sure did stand out in the MIT computer labs!