I've been trying to find a workshop PCA used to have on how to sort out those memory problems but have not found it!!!
You obviously have enough memory it may just not be in the right place.....
Try using Start > Run and type in sysedit - this will run up the system configuration editor.
Look at Autoexec.bat and config.sys for any entries which start with DEVICE= and change them to DEVICEHIGH= This will load all your Devices into high memory not normal memory. This may be enough to stop those problems.
The other solution may be to download a memory manager - I used to use a program called OuterTech Cacheman 4.1 for Windows 95/98/ME it's now up to version 5.11 I've not used this one but v4.1 was great.
Works by freeing up memory which is no longer needed, its shareware and you can check it out and download by click here