Windows can only use the amount of RAM that the programs you're running
need - although caching of programs will take place when there is more RAM
available, it will not affect the speed of the program, unless the actual
program runs out of space in RAM.
The number of programs and what type they are, will affect the amount of RAM
needed - for Win9x, it's rare for more than 128MB of RAM to be used, unless
you're doing some fairly heavy-duty graphics or database work.
The way to test whether RAM would increase performance is to check on the
amount of Virtual Memory in use - NOT the amount allocated. In a system with
sufficient RAM, the 'in use' figure will be usually below 20MB - with
insufficient RAM, the number can go up to 2GB.

System Resources refers to two 64K blocks of memory that Windows
allocates to programs for tracking purposes.  These blocks are called
User Resources and GDI Resources respectively and Windows reports
whichever has the least available free space as the value for "Free
System Resources".

The value of Free System Resources should not be a concern unless and
until you start getting "System Resources are getting low" type
warning messages, which generally happens at about the 10% level.  In
test circumstances it has been shown possible for a computer to
operate at full performance with System Resources showing zero percent
free.

System Resources are totally unrelated to the amount of RAM installed
in your computer and adding more RAM will not affect the System
Resources (unless you start running more applications because you have
more RAM).

System Resource usage is determined by the number and type of
applications that you have running on the computer.  Certain types of
applications have been shown to be especially demanding in terms of
System Resource usage:
-    "Eye and Ear Candy" such as Active Desktop View As Web Page,
sound effect schemes, animated mouse cursors and desktop icons, and
fancy screen savers.
-    Web browsers, as each open browser window requires additional
resources.
-    Multimedia applications of all types
-    System monitoring utilities such as Norton SystemWorks.

If you are using any applications that have the ability to "preview
fonts in fonts list" such as Office 2000 then all of the installed
fonts will be loaded into GDI resources when the application is
launched.  This will result in the usage of approximately 1% of GDI
resources for each 64 fonts that are installed.  If no such
applications are in use, or if the "preview fonts in fonts list" is
turned off then resources will only be consumed by those fonts that
have actually been used by windows or by an application.

If you are running any 16 bit applications (Windows 3.x) then Windows
95/98/Me will treat the System Resources allocated to all of these
applications as one block and will not release any of them for reuse
unless and until all of the open 16 bit applications have been closed.

Also, when an application is loaded it is quite common that it will
also require some additional Windows components to be loaded as well.
However, when that application is closed Windows will, by design,
retain the Windows components because they are likely to be needed
again.  Therefore the resources initially allocated when an
application is opened will not all be released when that application
is closed.  Most, but not all.

Footnote:
To be absolutely technically correct, there are 5 System Resource
heaps not just 2, the two 16 bit 64K ones plus three 32 bit ones.  The
32 bit ones are big enough so that there has never been a documented
instance of resource usage problems caused by them, so it is simpler
to pretend they do not exist and just focus on the two 64K resource
heaps when troubleshooting system resource related problems.

Ron Martell     Duncan B.C.    Canada

The tweak required is not MaxPhysPage but rather setting vcache=512000
where more than 512MB of RAM is installed otherwise the system runs out of
upper memory address space.  It is only necessary to limit MaxPhysPage
where, as you say, RAM exceeds 1.5GB but for many systems 1GB is the
maximum RAM that can be used.

For more details see:
KB 253912 - ""Out of Memory" Error Messages with Large Amounts of RAM
Installed" (http://support.microsoft.com?kbid=253912). The reason is that
allocating more than 512MB of RAM to vcache will exhaust all available
upper memory addresses and thus prevent them being used for other
purposes. This problem is easily fixed by limiting vcache to 512MB.

MS KB 296773 - "Computer May Not Hibernate with More Than 192 MB of
Memory"
(http://support.microsoft.com?kbid=296773).  This makes reference to an
updated file vmm.vxd.  Contact Microsoft, explain the problem, and mention
296773 and you should be given details of how to obtain the patch and the
password of the day.  Note that there should be no support charge for this
call other than for any telecom charges incurred in ringing Microsoft.

MS KB 304943 - "Computer May Reboot Continuously with More Than 1.5 GB of
RAM" (http://support.microsoft.com?kbid=304943).

Turning to System Resources you might want to have a look at Jim
Eshelman's "SYSTEM
RESOURCES FAQ" (http://www.aumha.org/win4/a/resource.htm).