I had this problem on a PC with Xen and Linux VMs. The VMs are configured to 
boot with just 400 MB of RAM allotted to them and up to 8GB max RAM.
I was never able to get above some 4.3GB in any VM, and log showed the 
"reserve_additional_memory: add_memory() failed: -17" message at that point


The SOLUTION that fixes it was proposed at qubes-devel mailing list (Qubes is a 
Xen+Linux distro for ultra-secure PCs):
     https://groups.google.com/d/msg/qubes-devel/VRqkFj1IOtA/UgMgnwfxVSIJ

As proposed there: if I set initial RAM to 800MB and max ram scales
above 4.3GB (actually tested to up to 11GB), without any "add_memory()
failed" messages.

The explanation given is that the VM's kernel allocates its memory
related structures at boot time and the memory available at that time
limits the max memory it may scale up to. When that happens, it starts
throwing the balloon error messages.

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https://bugs.launchpad.net/bugs/1304001

Title:
   xen:balloon errors in 14.04 beta

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