Even tho it has 512 ram it's only PCI, so that's your bottleneck.
The importance of the port type(PCI,AGP,PCIe) is that the higher the potential data transfer speed of the port, the quicker data can be transferred back and forward between the CPU and the graphics card. The old PCI standard transfers data at up to 133MB/s; AGP 1x transfers it at 266MB/s, up to 2,133MB/s at AGP 8x; and PCI-E 16x being the current fastest transfers it at a maximum possible rate of 4,000MB/s.
To better understand it read:
The Gamer's Graphics & Display Settings Guide
This from the guide about adding more ram:
Performance Tip: This step firstly highlights the effect of adding more RAM to your system: it won't increase FPS as such, but it will smooth out your FPS as the more data can be held in RAM, the less often your CPU has to wait for it to load from your hard drive. Note that by removing unnecessary background programs and processes from RAM you can also help increase the possibility of more information being loaded into RAM (See the Startup Programs and Services chapters of the TweakGuides Tweaking Companion). This step also highlights the importance of the Hard Drive, something which is often ignored: the higher your graphics settings and the faster your system, the greater the demand this places on your hard drive to supply new information to keep up this performance. The slower your hard drive - especially when combined with less RAM - the more loading pauses you will get as the CPU waits for data to load from the hard drive into RAM before it can use it. These pauses are commonly referred to as 'stuttering'. Once again defragmenting your hard drive can help reduce stuttering during games, but you may have to consider upgrading your hard drive to a faster model to truly reduce stuttering in more complex games.
So more ram will help you system, just make sure you end up with matched ram(size/speed). You might as well buy the fastest ram you can, I think for your rig it's pc3200. Depending on what you upgrade to you might be able to reuse the ram.
Saw a
2 gig kit here for $42.25 W/t free shipping. Call to confirm compatibility.
Good luck