How much and what kind of memory?

I saw the post above, but my question about RAM is a bit different.

I've come to the conclusion that I should get some more RAM for my iMac. 512MB just doesn't seem to cut it. I notice some slowdown when multiple applications are open at once, and activity monitor shows the processor as not being at 100% load at anytimes, so I am thinking RAM.

I don't really get that Active/Wired/Inactive/Used/Free thing. For instance at the moment it says "Wired: 88.90 Active:275.30 Inactive:139.30 Used: 503.50 Free: 8.50" The VM size is 6.98GB! is this because of not enough RAM. I don't like seeing less than 10MB of RAM free and than much VM. Also what is the difference between Real Memory and VSIZE?

So my options are Get a 512 stick, 1GB stick, or 2x 1GB sticks. I have read (or I think I have) that if you have 2 sticks of the same size on the Mac it can address them simultaneously with 128bit addressing. If i can benefit from the 128 bit addressing then I would want to do that. So I could get a total of 1GB or 2GB. I'm not sure which is better. If I am mistaken about the same size pairs, then I could just get the 1GB stick for a total of 1.5GB, which I think would be plenty, but I want the ability to have that extra speed if its there.