I can tell you that 8Mb of Fast RAM is not enough. I've got 8Mb Fast in my A500 and I keep running out when browsing webpages with javascript and thousands of pictures. But by far the worst is trying to print with TurboPrint. That program is a memory pig and if you use it, make sure you have at least 32Mb!
I wish I could find a way just to add another 8Mb to my A500! (although for most things, 8Mb is still OK)
I don't see how anybody could run out with 128Mb - unless they're trying to do some crazy things. I'm sure on a Windows computer with 1Gb RAM, you could run out of memory if you really wanted to.