pab1971, that is not correct.
Your graphics card memory is on the card itself for frame buffer and textures.
It does not form part of the 4gb Limit of 32bit Windows 7
You might see 3 gigs in windows 7 32bit. That will not increase if you add a graphics card.
Your graphics card memory will never show up as an extra Gig of system RAM in windows.
There is no need to upgrade for this, the upgrade would improve things only if you have 4gb of RAM on the motherboard then you will see all 4gb of it. The graphics card will use all of its 1 GB of ram on 32bit windows 7 too and only for graphics (games) related work.
PS: Your Windows 7 32bit keys work with 64bit also. You will have to find a matching edition of your windows 7 (E.g. if you have "Home edition" then you need Home edition 64 bit) and your key should work. Format and reinstall is necessary.