That thing happened to me when I using original Asus ROM. But after using 3rd party ROM (which had been slashed out all the unnecessary item/software). After flashing I can get more than 70MB free ROM after flashing. For free up RAM, you can use software like tMan (freewarePPC.net) to close your program by clicking the 'X' button. Because by default when you click the 'X' button, the software will only minimize and still consume your RAM. And for free up some RAM, you can use software like Oxios Hibernate (freeware).