Go into msconfig (start,run and type msconfig and press Enter) and click on
the Advanced tab and make sure the "Limit Memory ...." box is unchecked or
at least put in the correct amt of ram that you want to be recognized.
Or, try just the new ram stick or reverse the order of the two sticks of
ram.
Are you using both the new and old stick together?
If you are using two 256MB sticks, remove one and try it by itself.

When the system lists the exact amount of memory you installed but, Windows
lists less, there can be a number of reasons...
1) The memory limit Buffalo stated...
2) A line in the system.ini file which reads MaxPhysPage=????? ( where ?????
represents some number ).  This line really serves no purpose unless you
install more memory then the system can handle.  Since you only have 512MB
of RAM, this line is not required.  However, here is a link which explains
the settings:
http://support.microsoft.com/default.aspx?scid=KB;en-us;181862& .... if you
do find the line in system.ini, I recommend you either comment it out ( by
putting a semicolon @ the beginning of the line ) or remove the line
altogether.
3) There may be a DOS based application which is utilizing the memory @
startup....hence, Windows can't see or use this memory.
4) There may be a problem with the memory.  Download a program called
memtest86 from www.memtest86.com to test the memory.

HTH....