Hi Angela,
A few weeks ago, someone mentioned on PCBUILD that Window ME wasn't working well with 512Mb (or over 512 mb, I don't remember). So I suggest to use 256 mb. 128 mb is good even if you open lot of Word documents. If you want to use 512 mb, you should install Window2000 or XP.
You can use a trial version of utilities to monitor the use of memory.
like FreeMem:
http://www.3bsoftware.com/products/freemem.html
good luck,
-Christian Thu-Thon