655,360 bytes (640KB) is the max conventional (memory programs run in) memory you can have in DOS.
You have 634,288, which is 614KB. You must remember DOS itself takes up some of that memory.
If you want a detailed list of what is using conventional memory use the command "mem/c|more". Pay attention to the frist section titled "Conventional Memory", see what programs are listed there. The default config for the Win2k DOS emulator is for all such capable programs to load to the high/upper memory area keeping more conventional memory free, but there are some programs that just can't do that and must stay in conventional memory. So basically, you most likely won't be able to free any more.