|It already has a modem since you were able to query it so you don't need to worry about that.|
I've only used AOL and I've always used their setup that came with 98 or one of their installation cds. So I've never done it the way you're attempting but it looks like you just need to know what ISP you want and the access number.
The ram thing could be due to two things--either the PC isn't capable of seeing a 256 meg stick or the stick has high density chips that the PC can't read. Well, that's assuming the ram is good, correctly installed and the slot is clean and free of dust..
The toolbar could be because the desktop is setup in a 'classic' style. You should be able to right click on the desktop and fiddle with the look there.