I could be wrong but I thought 1.3 required more than 64mb to run and upgrade properly. I'm sure someone will be glad to correct me if I'm mistaken.
Anyway, any Dell Poweredge server will already have at least 512 MB installed. All of my 30+ embedded hardware m0n0walls are running either 128 or 256 MB and I'm not having any problems with performance or lockups.
CS...