The Tech Report tries to answer how many megabytes of memory a GeForce 8800 GT graphics card really needs:
More recently, we've seen a much smaller but not less absurd memory myth take hold in the graphics card industry. Budget cards equipped with ridiculous amounts of memory are the culprit here. For enthusiasts, a gig of memory on a sub-$100 graphics card makes about as much sense as putting a spoiler on a Yugo. Budget GPUs lack the horsepower necessary to run games at the kinds of resolutions and detail levels that would require such a copious amount of video memory. But what about the latest crop of mid-range graphics cards? Nvidia's GeForce 8800 GT has considerable pixel-pushing power on its own, and when teamed in SLI, that power is effectively doubled. Perhaps a gigabyte of memory on this class of card isn't so unreasonable.
Conveniently, derivatives of the GeForce 8800 GT are available with 256MB, 512MB, or 1GB of memory, making it easy for us to probe the impact of graphics memory size on performance. We've tested a collection of single cards and SLI configurations in a selection of new games, across multiple resolutions, to see where memory size matters, if it does at all. Keep reading for the enlightening results.
Read more over here. The reporter concludes 512MB is the best config for a GeForce 8800 GT. More memory would just be a marketing gimmick as it barely improves the performance.