Two things: Gaming under XP is best at 2 gigs of RAM and if I am reading correctly the information you gave us your video is onboard rather than a dedicated card, correct?
Your cpu meets the need and even though they say 256 megs of system memory is enough in all seriousness that is the bare minimum just to be able to run XP. Again, 2 gigs for gaming under XP is the sweet spot. I also came across this online:
Supported video hardware
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* Age of Empires III requires a minimum of 64 MB of memory for video hardware. Additionally, the video hardware must support Hardware Transform and Lighting.
* Your hardware must pass a system check when you start the game. If your video hardware did not pass the system check, you will receive one of the following error messages that indicate that Age of Empires III does not support the video hardware:
* Your video hardware is below the recommended minimum requirements for Age of Empires III. If you wish to upgrade your computer, please contact your computer manufacturer for any necessary assistance.
* Age of Empires III requires at least a 64 MB video card. This computer appears to have a less than 64 MB video card. If you wish to upgrade your computer, please contact your computer manufacturer for any necessary assistance.
* The video hardware is supported if it meets the memory requirement and passes the system check when you start Age of Empires III. For more information about graphic related issues that you may experience when you play Age of Empires III, click the following article number to view the article in the Microsoft Knowledge Base: 907881 (
http://support.microsoft.com/kb/907881/) Known graphics issues in Age of Empires III.