You don't need more than 512MB under WinXP but if you want it for the future it isn't a bad investment. I have an XP2100+ with 512MB of DDR333 and I am doing similar applications to what you are doing. I can use PS7 on this laptop and it only has a PIII-M 650MHz and 128MB of PC100 under Win98.
If I was building a money-is-no-object system, I would have a gig of RAM, just make it a little more future-proof. However, if I was on any sort of budget, I wouldn't buy the extra 512 meg in lieu of any other components. I would start with 512 megs and make sure everything else in my system is up-to-snuff before I'd buy any more RAM.
<font color=green>The Netherlands is where you go when you're too good for heaven.</font color=green> :tongue: