Under the 'x86' architecture (32 bit), the system can only address 4 GB of allocated memory.
Traditionally yes, but not always:
http://en.wikipedia.org/wiki/PAE But it does look like 4GB minus about 680M. The machine is probably not capable of PAE or the kernel being used is not built for PAE support.
jim
Tim Newsham http://www.lava.net/~newsham/