Standard apps could not take up 100mb of memory. I figured the SenseUI apps probably take up some space but not that much.
The answer is.........nobody knows why it only shows 159. HTC doesn't know, VZW Tech Support doesn't know and now the VZW store customer support doesn't know.
Long story short, I got a Droid again as I just feel I'd end up running out of space within 3 to 6 months. Just goes to show, stick with your first choice.
For those of you with an ERIS I'd beware of this issue. If you are not doing too much and not downloading too many apps you'll be fine but you may be very disappointed in the next 3 to 6 months if you run out of internal RAM.
**Edit - ok, maybe the Android OS and HTC SenseUI take up 323mb of the total 512 ROM available. That sounds like alot if you ask me but I will admit that I don't know much about these things.