For me, the big payoff has been to stick with 512MB, then upgrade the stock drive from a lowly 4200 RPM drive to 5400 or even 7200.
My personal laptop boots in 1/2 the time so it appears to me that this under 99 buck update paid off well.
I'm thinking of getting an upgrade for my laptop this Christmas. It is Toshiba Portege R100. As far as I'm concerned it has 256MB DDR fixed onboard and one SODIMM slot easily accessible which supports DDR266 up to 1GB for a maximum total of 1280MB.
The problem is, the difference between 512MB and 1GB upgrade. A 512MB SODIMM costs HK$680(about US$87) but a 1GB one costs HK$2150(about US$275), from a local dealer.
If I buy the 1GB one I can turn off virtual memory completely, not only getting improved performance but also reducing harddisk workload to extend it's life span. If not I will still have to make some headroom by turning on virtual memory.
I use the laptop mainly for dealing with digital images, graphics and 3D games at times. Does the additional 512MB memory capacity worth US$190 in this case? Since once upgraded, the only way to add further memory is by replacing.