I agree with the comment of not leaving defaults, as I have seen that that usually means take all be 1 MB of memory.

I also believe that if you go above 2 or 4 GB, dynamic memory utilization is no longer possible, SQL Server has to go into fixed memory size.  It may not start out with that much memory, but it will not give it back.  I have also seen Enterprise manager refuse to switch to dynamic memory when there was that much available.

The first part about the OS and memory was good.

One question, does this mean I should always leave at least 1GB physical Ram for the os?