I don't know if this is a repost. I did a quick search and i didn't find anything.
I've tested this and i don't know how it works, but it does.
If you just have 256mb of RAM when you install Windows XP, and after the installation has finished, you put in the the chips you would normally use. The memory that XP uses will be reduced (in my case) significantly.
Hope this helps anyone.
-Dalla