A PS3 at 1Tflop with 256 megs of ram vs an Xbox2 with a midrange CPU and ~1 gig of ram would even things out nicely.
Well.. You also have to factor in PS3's *other* memory; such as e-DRAM on Cell and memory on the Rasterizer.
Assume 256mb main ram + 16mb e-DRAM(Cell) and 64mb VRAM for the Rasterizer.
But yea, I can see MS really just dumping tons of ram(GB) onto Xbox2 if PS3 really takes everyone by surprise. But otherwise I still see them going with 512mb's worth.
Unless if by some chance PS3 uses 512mb of External XDR, but I don't know about this.