Agreed, running a virtual instance of an OS benefits from added RAM.
Just to add though, all modern operating systems will use up all available RAM all of the time. Obviously programs that you are running and using need to have instructions in RAM. Also though, recently created or modified files, recently used applications, etc are all cached and will be stored in RAM until they are booted out by demand or because of newer files. If something is cached in RAM you can access it a lot faster! More RAM means higher probability what you need will be there (hit rate).
So more RAM means a higher hit rate of instruction sets, but at the cost of a higher latency. I know C2D doesn't support 8 gigs of RAM, but hypothetical if it did, i would think twice about that upgrade for the added latency, which would be exacerbated by a weaker processor. Also having a fast SSD disk makes a RAM miss less of an issue on the MBA.
Anyway i'm not really saying anything here, I just thought i'd explain a little how things worked so people could decide what they wanted.