Photoshop CS5.5 not showing correct amount of RAM

I have a PC with 3.25 MB of memory.  I recently purchased the Creative Suite CS5.5.  I was modifying my Preference when I noticed on the Performance Tab, under Memory Usage, it says:
Available RAM 1569
Ideal Range: 863 - 1129
Let Photoshop Use: 941 MB
Anyone know why Photoshop is only seeing 1/2 of my memory?

Thanks for the explanation Chris and Sabastian.  I appreciate you taking the time to provide a good explanation.
Mylenium, you have a way with words.  Guess you have the gift of encouragement.  I did see the "Available Memory" but I read it as that's how much physical memory Photoshop was seeing on my computer, not the amount of memory that was unused at the moment. 
I'm pretty sleep deprived as of late so I know my brain's "Available Memory" is running low and not running to it's fullest capacity. 

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       HDRMergeUI 11.0
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       Liquify 11.0
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       Neon Glow 11.0
       Note Paper 11.0
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       Paint Daubs 11.0
       Palette Knife 11.0
       Patchwork 11.0
       Photocopy 11.0
       Plaster 11.0
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       Poster Edges 11.0
       Read Watermark 3.0
       Reticulation 11.0
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       Save for Web & Devices 11.0
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       Sumi-e 11.0
       SuperPNG 2.0
       Texturizer 11.0
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       Underpainting 11.0
       Vanishing Point 11.0
       Variations 11.0 (11.0x001)
       Water Paper 11.0
       Watercolor 11.0
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    Flash: 0
    Installed TWAIN devices: NONE

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