back on the topic of the OP, the problem isn't RAM per-se. Android since FroYo has been designed to kill off tasks on its own to free up resources for another task (most programs are always running on Android, don't need to be closed down like in Windows, and continue their stuff in the background in a sort of minimized state, and are only closed by the system when the user opens another program that requires more than what is available. for example, let's say you have a phone with 512MB RAM. 480MB is used up once the system is up and running. user decides to launch Angry Birds. whoops! not enough memory. so the lower priority tasks are closed down, thus freeing up enough to launch the game. this can induce a bit of lag or slow launch, but avoids the need to have the user monitor RAM usage or close programs down manually)
The problem is when you have a device with little RAM to begin with and too many apps trying to access it, which causes Android to respond with multiple calls to close down some apps to make room, but these apps are often high priority (such as Play Store) and just start back up again, then it runs out, so it goes back to closing things down, but they start up again, eventually Android is inundated with too many apps trying to fit within too little RAM, and it cannot stop them all to make room. so 12 apps are trying to simultaneously run their background processes in memory that can only hold 6, and this is your infamous 'Android lag'. this mostly only happens on lower-spec devices, but can happen on flagships if enough apps are installed or running. if one does a logcat, a log of maintenance messages in Android, you'll see 'low memory--no more background processes' showing up on such a device where too many apps are trying to run in too little RAM, causing Android to call up the built-in killer to close down some to make room. most random reboots are out of memory (OOM) panics. if one did a logcat and the device auto-rebooted itself, upon restart the log entry 'E: OOM panic occurred, restarting' would be shown. so in essence, Android CAN run out of memory. but there is no need to have the user killing tasks via a task killer which only makes the problem worse. in the end it's more a matter of knowing your device and installing apps that don't need to do so much.