'Need' is a word that will vary dramatically from person to person. I'm currently on a computer running Win XP with 128 MB of memory. I have Visual Basic 6, Word, Excel, MathCad, and Internet Explorer open, running, and I'm actively using them all at the same time without any noticible lag. This is in addition to McAffee and Zone Alarm and all the Windows stuff that run in the background. Basically if I can do all this with 128 MB, then 256 MB is sufficient for most people. It seems from your post that you fit this category.
There are programs that need a lot more memory though to run well. At home I use 384 MB for my gaming computer (Win XP) and it runs quite well (Note: I don't have BF1942 though) on every game I play including online games. I personally recommend 384 MB as a minimum for new computers bought today (to everyone even if you are not currently using memory intensive programs - just to allow for future uses which may arise) and 512 MB - 1 GB for the heavy computer enthusiasts who will run memory intensive programs. If I bought a gaming computer today, I'd get 768 MB.
Note: dual channel motherboards and people who overclock should probably avoid the less common 384 MB and 768 MB numbers - but for the rest of us they often are the ideal price/performance balance. Unfortunately too many people overlook these options.