Yes, that's right. PSE is still a 32 bit application, which means it can only see that much ram. You can increase the amount available in the prefs up to 90% or so, but the main advantage to extra ram where PSE is concerned is that you have more left over for other programs and activities.
I wish they mentioned it clearly on the product description, it's such a deal breaker for me. More memory for other programs is not really a concern because I, like most other people, focus on the images while working on them.
Thanks for your reply though.
Yes, I am seeing a problem. When merging multiple frames into a Pano, PSE tries to extrapolate the image vertically to fill the edges. That does not work at all with 4 GB.
Besides, more the merrier. With more memory, I expect the response to be snappier even for normal edits.
I understand that Adobe may want to push me over the edge towards the CS6 if the above really matter to me. It's like driving an economy car versus a luxury car. I only wish the price difference wouldn't have been so huge.