The memory amount GTA IV lists in its graphical options screen is video memory. This is situated on the video card, it cannot be upgraded without buying a new video card, you cannot use system memory to augment it. I believe the GTX 285 didn't come with more than 1GB of video RAM. GTA IV needs close to 1.5GB in order to max it out at 1080p resolution. You'll just have to turn some settings down to keep the video memory usage below 1GB, or you are going to have to go out and buy a newer video card that has more than 1GB of video RAM.
Ok thank you.