The amount of RAM that can be placed on the board is independent of cache size. Intel deliberately hobbled the TX chipset to a cacheable limit of 64MB because it was not classed as a high end chipset. It was the HX chipset's job to provide high performance.
The cacheable limit simply states how much RAM can be mapped to the cache. While 64MB of 160MB is fine, the problem is that Windows' memory structure is top down, resulting in critical data being located from the top of the RAM, ie starting at 160MB and working down in your case.
Depending on what you run, this cacheable limit may or may not be a problem. Where the data required to be stored in RAM exceeds 64MB, then by all means, 160MB of RAM is usually better than having to go and thrash the hard drive for data. If the amount of RAM actually required by your system load was less than 64MB, then it would be somewhat slower than what it would have been had you have all your RAM cached.
Normally the AMD K6-2 400 uses a multiplier remap of 2 to 6. So where normally you would need to set the multiplier to 6, you can set it to 2 instead where the motherboard has no setting for such a high multiplier. I can't remember if it was 2 or 2.5, but it's one of those. So set the speed to 133 or 166, and you should see the system boot up at 400 instead.