I use Roxio's Easy Media Creator 7.5 (it's an older version) on XP. I have created slideshows and montages over the last couple of years for our booster club banquet and turn them into DVD movies to play at the event and sold them as a fund raiser afterwards.
Anyway, my longest montage production lasted almost 8 minutes and probably has close to 100 edited video clips (many minutes long). I only have 1.5G of memory on my laptop and faced no issues at all. Although, the rendering did slow down after a while. A decent editing program should not be a memory hogger and should store only editing information (start/stop, speed, sizing, etc.) in RAM.
If you're interested, you can buy old versions of video creator/editor off eBay for cheap (EMC 7.5 is about <$15 new). I use Roxio only because that is what I bought but several other tools are just as good or better. Movie Maker is handy and free but it has its limitations. I don't use it hardly at all, but already found that you can only save files in *.wmv format, which limits what you can do with the final products without more fussing and losing fidelity.