About the 128Mb limit, it is a little short to my taste as well. You can do multitasking but to the physical memory limit. Wookiechat + polyglot + sputnik + mail + shell + music + ... = memory shortage. This is not an uncommon situation.

VMem would be nice to have. Even if this impact somewhat the responsivness of the system, I take.

How memory left do you have at boot?

I have around 82Mb free (1650x1080x16 ambient)