yes, you are correct, its as simple as that. if your existing memory is single sided, move them to slots 2 & 3 and put the new double sided 512mb in slot 1
if your existing memory is all double sided then i think you would have to lose a memory strip for it to work.
one last thing, if you are using windows98 then the memory might not work as win98 has an upper limit of 512mb total memory, putting more in can actually reduce performance. windows xp/2000/NT does not have this limitation.
p.s. handle the memory by the edges, not on the chips, static electric can and probably will damage the memory.