|I tend to agree that it is not a Windows problem. Windows XP is actually pretty good with memory management, a huge improvement on previous versions. If there were some inherent fault in Windows memory management it would have shown itself a long time ago.|
Having said that, free RAM is not a good indicator of how well memory is being managed. Windows will use all the memory it can get it hands on which is good thing as unused memory is wasted. It will free up allocated but currently unused memory as and when required,
If the application requires 500 Mbs Windows will make 500 Mbs available by either freeing up allocated memory or swapping stuff out to virtual memory.
How do you have virtual memory configured? It should be configured to allow Windows to manage it. Setting values yourself can cause untold problems unless you are very familiar with Windows memory management and the applications you are using. Make sure there is enough space on the drive where the swap file is stored. There should be at least 3 Gbs with 1.5 Gbs of RAM.