I am working on a laptop with 768 MB of memory and have never had this message. I usually have Firefox running and often Photoshop, too.
You might have a windows problem with memory not being released after an application closes. Apple solved this problem about 20 years ago, but Micro$oft still seems to struggle with the simple stuff.
I have FreeRam XP Pro 1.51 and that seems to keep things working better. Although it does hog the entire system for a few seconds when it has do it's RAM-freeing thing.
If freedom means anything at all, it is the liberty to tell others what they don't want to hear.