Use this free tool to check your system information (doesn't require any installation): http://www.gtopala.com/index.html
Scroll down to the section entitled "Memory" in the left hand pane and click on it. It'll show you how many modules are installed (I suspect 2 modules, each with 256 mB of memory). If only one shows, then you'll have to crack the case (remove the battery first) to see if there's 1 or 2 installed.
Each memory tool extracts information on your memory differently. Frequently a lot of the memory tools won't take the "shared video memory" into account when posting their results (the Windows System applet, General tab is one of these). This is because that memory is reserved for video and isn't accessible for regular RAM usage (so it's 'effectively' not there).
Basically, here's what you've got:
2 - 256 mB RAM modules (physical memory chips)
64 mB of it is shared video memory - and isn't recognized as RAM because of this.
If so, then you should see one stick with 192 mB and one stick with 256 mB
1 - 512 mB RAM module
64 mB of shared video memory.
If so, then you should see one stick with 448 mB of RAM
I suspect that you're seeing the 192 mB stick and the 256 mB stick - if so, this is normal.
If not, and you're only seeing one stick - then one stick isn't being registered. You've got 2 things to check in this case:
1) Remove the battery, crack open the case (grounding yourself on the metal of the case), remove the chips, clean the contacts and the slots that they go into. Then reinsert the chips, making sure that they're properly seated (I goofed on this one the other day) and boot up to see if they're detected properly.
2) Run this free utility to check the memory chips themselves. Follow the directions carefully and let the test run for at least 2 - 3 hours (overnight is better). Any errors that show up may be cause to suspect the RAM modules. http://www.memtest86.com/
If you do encounter errors - try running the test with only one of the modules installed. Then try it with only the other module installed - this will give a better idea of what faults exist.