Ahem, a few fixes I feel like I need to make. First, PS3 has 256 MB of RAM and 256 MB of VRAM and they're not the same thing. Second, 360 has 512 MB of memory shared between the system and the GPU so it's not all RAM either (in any games at least). Also, your claim of PS360 using 256 of RAM for the OS is just ridiculous. It's simply not possible for the PS3 because it has 256 MB of RAM total. Last I heard anything about PS3 OS's memory usage, it was 60-90 MB I think - and it could have been much lower. Don't know about the 360 though but I doubt it's 256 MB because games would have hardly anything to work with.

And now I'm not entirely sure but I wouldn't say PCs have more RAM because of running more processes. Those processes aren't even running most of the time so why would the use RAM then? Games alone use much more RAM on PC than they do on consoles. If I had to guess, I'd say some of it goes to better graphics and stuff (if you can keep more stuff in memory, why not?), some of it goes to running the games better (PC games typically go above 30 frames per second, and yes, I know RAM isn't exactly the primary concern here but it's a factor nonetheless), and some of it goes to 'heavier' architecture (ie. games get more direct access to hardware on consoles).

Great first paragraph, horrible second paragraph. 

Just to add to the first one, the Xbox 360 uses 32 MB of RAM for the OS and the PS3 uses 50 MB.  The Xbox 360 has 512MB - 32MB available to a game at any given time, where as the PS3 is a little bit different.  If memory serves me correctly, available to a game would be 256MB - 47MB and available to video would be 256MB - 3MB.  However, the PS3 GPU can access the system RAM through an expensive process, so the GPU has potentially up to 462 MB.  But again, it's an expensive proposition to use any part of the system memory from the GPU.  Not to mention, the CPU has so little memory that using what's left for video would probably create more problems than it solves.

If a process is running it is using memory.  Processes are terminate-stay resident (TSR) programs.  If you're old enough, like me, you can recall a time when such processes didn't exist.  You either ran a single program or you didn't.  TSRs either offer a UI until "closed" like Skype, or they never display a UI.  Most of the services within Windows are the latter.  An OS is just a kernel with basic I/O functionality.  The modern OS, with the aid of other programs running in the background actually give it functionality.  The UI of your OS is a separately running program from the actual kernel.  The ability to log in is a separate function from the core OS.  The ability to connect to the Internet, not a Web browser but connect to the Internet, is a separate function of the OS.  All of these parts and pieces require programs, programs that run in memory and as processes.  To be more efficient, they run constantly, so they're always on. 

So yes, the reason PCs need so much memory is in fact because of everything that is running on them.  That's one reason why some people prefer Linux, because depending on the distribution, and how you configure it on install, you can produce an OS that is extremely lean and has few resource requirements.  Games may in fact take more memory on a PC than a console, but that's largely due to the fact that PC games have to support a wider array of hardware, and some functionality that is built into consoles much be built into PC game.

Yep and Pachters face on the crazy redneck^^

The shot with the 3 guys should be Iwata, Shibata and Reggie and the shot with the two guys Miyamoto and his Translator xD

There are a few things I would like to know before I really comment on whether 1GB is too little or enough for games, how much embedded memory is on the CPU and GPU and whether that memory is included in the 1GB total is a good starting point.

It is plausable that the CPU would have 32MB of embedded dram built into it which would allow most of data that the CPU will manipulate on a per-frame basis to be stored in embedded memory, and if the GPU had 64MB (or more) embedded memory it could hold all of the screen buffers and have a high performance texture cache. If embedded memory was not included in the memory total, then the 1GB of memory would (mostly) be used for storing game assets (models, textures, etc) that are in the "level" but not necessarily being rendered to screen; and with decent streaming from the disk to memory 1GB would not be that bad.

The Xbox 360 and PS3 are running 512MB and they still do some pretty impressive things.

Ofcourse its dated hardware. The best looking Wii U games probably aren't going to look much better than current PS3 and 360 games.