Yes older graphics cards steal some ram. Nvidia calls it turbo cache.
The reason you have to have 1 gb of ram for turbo cache to be enabled is because with less than 1 gb of ram, there wouldnt be much ram left to use.
BTW... i think turbo cache is not enabled when just browsing the web ect... just when playing games.
Here is a link to better explain : http://www.nvidia.com/page/turbocache.html