I run a magento store 220.127.116.11 with 1500 itens at a Hostgator VPS, I have 1.98 GHZ and 1344 MB of Ram memory.
I did many speed test with http://tools.pingdom.com/ and http://loadimpact.com/pageanalyzer.php and belive me:
THE FASTEST WAY FOR MY SITE IS WHEN I RUN .HTACCESS WITH 32MB OF MEMORY
I have memcache and I do not know why with some just litle memory I gote the best performance and I did this test many times: with 256MB, 128MB, 64MB and 32MB.
betwen 256MB and 32MB, 256 is 1 second slow than with 32 Mb.
soo my conclusion is that you do not need too many ram… and I do not know why…