Computer error - 'Out of Memory'

Hi all,
Company I edit for bought a new tower. Here are the specs
Processor Two 2.66GHz 6-Core Intel Xeon
RAM 12GB
Graphics Card ATI Radeon HD 5870 1GB
Yesterday was my first day on it, and all went fine until I started bringing render-heavy motion files into Final Cut. It would start rendering them, and then stop and say 'error -- out of memory'.
The internal drive has 800G of free space, but Just to be safe, I switched the scratch disc to an external with 400G of free space. Got the same error and message.
I also tried trashing preferences, repairing disc permissions and restarting. No luck.
I switched to my laptop (2.8 GHz Intel Core 2 Duo/4G Ram) and the sequence rendered just fine (if a little slow).
Any idea what's wrong? We bought the machine specifically for rendering and compressing, so this is pretty frustrating...

I've only run into this problem in a ProRes project, with clips transcoded from a Canon 7D. Other projects, using DVCPRO HD 1080, with lots of effects, haven't done this. What seems to help is 1. If you're using still files, make sure they're RGB and 72ppi; when I can I use jpgs rather than tiffs, and I think it helps to make them no larger than you need; 2. Close the sequence tabs you're not using, especially if they're psd still files; 3. Selectively render only the tracks at the top; 4. Save after every render.
If anyone has other ideas, please let us know. This really can be a pain.

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• free Space on Start-Up (Mac OS) Hard Disk - VERY IMPORTANT
• Space availably on Hard Disk/s That holde the Movie Material
RAM
Never been a problem to me - 2 resp 5Gb dep on Mac used
Free Space on Boot HD
I never go under 25Gb free space - when working on SD-Video project's - I guess that 4 - 5 times more will be a safe level when doing HD. This space HAS TO be just here as Mac OS works like UNIX (it is in fact) and then produces lot's of temp. files that can not be stored elsewhere and so does FinalCut (or whatever application running)
Space to keep Movie Project
• Should be on other hard disks than the Boot HD.
• Should be as fast as possibly - RAIDed, FireWire or Thunderbolt - USB/USB2 performs badly to me and especially when filling up and when holding HD-material
• MUST BE - Mac OS Extended (hfs) formatted - this goes for all Video editing - iMovie, FinalCut or Adobe etc.
• This too can fill up - So this space is also important
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If you really want me to hold your hand I will. Here's some links that came up when I typed "Out of Memory"
http://discussions.apple.com/thread.jspa?messageID=7490395&#7490395
http://discussions.apple.com/thread.jspa?messageID=7376550&#7376550
http://discussions.apple.com/thread.jspa?messageID=7480220&#7480220
http://discussions.apple.com/thread.jspa?messageID=7756170&#7756170
If you still don't find what you need post back and there's a few other things you can try.
FYI- No need to be a smart a$$ to someone trying to help you.

Computer error - 'Out of Memory'

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